10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2023

or

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 001-32136

Arbor Realty Trust, Inc.

(Exact name of registrant as specified in its charter)

Maryland	20-0057959
(State or other jurisdiction of incorporation)	(I.R.S. Employer Identification No.)
333 Earle Ovington Boulevard, Suite 900, Uniondale, NY (Address of principal executive offices)	11553 (Zip Code)

(Registrant’s telephone number, including area code): (516) 506-4200

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbols	Name of each exchange on which registered
Common Stock, par value $0.01 per share	ABR	New York Stock Exchange
Preferred Stock, 6.375% Series D Cumulative Redeemable, par value $0.01 per share	ABR-PD	New York Stock Exchange
Preferred Stock, 6.25% Series E Cumulative Redeemable, par value $0.01 per share	ABR-PE	New York Stock Exchange
Preferred Stock, 6.25% Series F Fixed-to-Floating Rate Cumulative Redeemable, par value $0.01 per share	ABR-PF	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	þ	Accelerated filer	o	Non-accelerated filer	o
Smaller reporting company	o	Emerging growth company	o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ

Issuer has 188,501,642 shares of common stock outstanding at October 20, 2023.

INDEX

PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)	2
Consolidated Balance Sheets	2
Consolidated Statements of Income	3
Consolidated Statements of Changes in Equity	4
Consolidated Statements of Cash Flows	7
Notes to Consolidated Financial Statements	8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	47
Item 3. Quantitative and Qualitative Disclosures about Market Risk	60
Item 4. Controls and Procedures	61
PART II. OTHER INFORMATION
Item 1. Legal Proceedings	61
Item 1A. Risk Factors	61
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	62
Item 6. Exhibits	63
Signatures	64

Forward-Looking Statements

The information contained in this quarterly report on Form 10-Q is not a complete description of our business or the risks associated with an investment in Arbor Realty Trust, Inc. We urge you to carefully review and consider the various disclosures in this report, as well as information in our annual report on Form 10-K for the year ended December 31, 2022 (the “2022 Annual Report”) filed with the Securities and Exchange Commission (“SEC”) on February 17, 2023 and in our other reports and filings with the SEC.

This report contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements relate to, among other things, the operating performance of our investments and financing needs. We use words such as “anticipate,” “expect,” “believe,” “intend,” “should,” “could,” “will,” “may” and similar expressions to identify forward-looking statements, although not all forward-looking statements include these words. Forward-looking statements are based on certain assumptions, discuss future expectations, describe future plans and strategies, contain projections of results of operations or of financial condition or state other forward-looking information. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. These forward-looking statements involve risks, uncertainties and other factors that may cause our actual results in future periods to differ materially from forecasted results. Factors that could have a material adverse effect on our operations and future prospects include, but are not limited to, changes in economic, macroeconomic and geopolitical conditions generally, and the real estate market specifically, in particular, due to the severity and duration of the novel coronavirus (“COVID-19”) pandemic; the potential impact of the COVID-19 pandemic on our business, results of operations and financial condition; adverse changes in our status with government-sponsored enterprises affecting our ability to originate loans through such programs; changes in interest rates; the quality and size of the investment pipeline and the rate at which we can invest our cash; impairments in the value of the collateral underlying our loans and investments; inflation; changes in federal and state laws and regulations, including changes in tax laws; the availability and cost of capital for future investments; and competition. Readers are cautioned not to place undue reliance on any of these forward-looking statements, which reflect our views as of the date of this report. The factors noted above could cause our actual results to differ significantly from those contained in any forward-looking statement.

Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. We are under no duty to update any of the forward-looking statements after the date of this report to conform these statements to actual results.

i

PART I.    FINANCIAL INFORMATION

Item 1.    Financial Statements

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

($ in thousands, except share and per share data)

	September 30, 2023		December 31, 2022
	(Unaudited)
Assets:
Cash and cash equivalents	$	895,298	$	534,357
Restricted cash	419,158		713,808
Loans and investments, net (allowance for credit losses of $184,069 and $132,559)	12,892,796		14,254,674
Loans held-for-sale, net	364,320		354,070
Capitalized mortgage servicing rights, net	392,203		401,471
Securities held-to-maturity, net (allowance for credit losses of $5,943 and $3,153)	155,172		156,547
Investments in equity affiliates	62,795		79,130
Due from related party	211,655		77,419
Goodwill and other intangible assets	92,551		96,069
Other assets	416,741		371,440
Total assets	$	15,902,689	$	17,038,985
Liabilities and Equity:
Credit and repurchase facilities	$	3,391,441	$	3,841,814
Securitized debt	7,004,634		7,849,270
Senior unsecured notes	1,332,926		1,385,994
Convertible senior unsecured notes	282,428		280,356
Junior subordinated notes to subsidiary trust issuing preferred securities	143,695		143,128
Due to related party	2,170		12,350
Due to borrowers	114,660		61,237
Allowance for loss-sharing obligations	69,261		57,168
Other liabilities	320,973		335,789
Total liabilities	12,662,188		13,967,106
Commitments and contingencies (Note 13)
Equity:
Arbor Realty Trust, Inc. stockholders' equity:
Preferred stock, cumulative, redeemable, $0.01 par value: 100,000,000 shares authorized, shares issued and outstanding by period:	633,684		633,684
Special voting preferred shares - 16,293,589 shares
6.375% Series D - 9,200,000 shares
6.25% Series E - 5,750,000 shares
6.25% Series F - 11,342,000 shares
Common stock, $0.01 par value: 500,000,000 shares authorized - 188,501,642 and 178,230,522 shares issued and outstanding	1,885		1,782
Additional paid-in capital	2,364,395		2,204,481
Retained earnings	104,821		97,049
Total Arbor Realty Trust, Inc. stockholders' equity	3,104,785		2,936,996
Noncontrolling interest	135,716		134,883
Total equity	3,240,501		3,071,879
Total liabilities and equity	$	15,902,689	$	17,038,985

Note: Our consolidated balance sheets include assets and liabilities of consolidated variable interest entities, or VIEs, as we are the primary beneficiary of these VIEs. At September 30, 2023 and December 31, 2022, assets of our consolidated VIEs totaled $8,689,298 and $9,785,261, respectively, and the liabilities of our consolidated VIEs totaled $7,027,893 and $7,876,024, respectively. See Note 14 for discussion of our VIEs.

See Notes to Consolidated Financial Statements.

2

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

($ in thousands, except share and per share data)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Interest income	$	336,474	$	259,778	$	1,000,159	$	627,804
Interest expense	229,180		160,452		675,749		350,079
Net interest income	107,294		99,326		324,410		277,725
Other revenue:
Gain on sales, including fee-based services, net	18,619		14,360		55,795		32,526
Mortgage servicing rights	14,109		19,408		48,769		52,287
Servicing revenue, net	35,463		22,744		97,376		64,513
Property operating income	1,450		445		4,261		1,031
Gain (loss) on derivative instruments, net	(421)		(15,909)		(3,582)		10,083
Other income (loss), net	173		(6,014)		5,099		(16,061)
Total other revenue	69,393		35,034		207,718		144,379
Other expenses:
Employee compensation and benefits	39,810		38,811		123,518		119,736
Selling and administrative	12,367		13,225		38,574		40,960
Property operating expenses	1,479		366		4,227		1,443
Depreciation and amortization	2,286		2,078		7,297		6,092
Provision for loss sharing (net of recoveries)	1,679		412		12,528		(2,199)
Provision for credit losses (net of recoveries)	18,652		2,274		55,047		9,700
Total other expenses	76,273		57,166		241,191		175,732
Income before extinguishment of debt, income from equity affiliates and income taxes	100,414		77,194		290,937		246,372
Loss on extinguishment of debt	(314)		(3,262)		(1,561)		(4,612)
Income from equity affiliates	809		4,748		20,694		18,507
(Provision for) benefit from income taxes	(5,854)		374		(19,436)		(13,166)
Net income	95,055		79,054		290,634		247,101
Preferred stock dividends	10,342		10,342		31,027		30,612
Net income attributable to noncontrolling interest	6,789		6,002		21,200		19,811
Net income attributable to common stockholders	$	77,924	$	62,710	$	238,407	$	196,678
Basic earnings per common share	$	0.42	$	0.37	$	1.30	$	1.21
Diluted earnings per common share	$	0.41	$	0.36	$	1.28	$	1.18
Weighted average shares outstanding:
Basic	187,023,395		170,227,553		183,340,149		162,292,235
Diluted	221,328,818		205,865,016		217,457,399		195,529,340
Dividends declared per common share	$	0.43	$	0.39	$	1.25	$	1.14

See Notes to Consolidated Financial Statements.

3

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Unaudited)

($ in thousands, except shares)

Three Months Ended September 30, 2023
	Preferred Stock Shares	Preferred Stock Value		Common Stock Shares	Common Stock Par Value		Additional Paid-in Capital		Retained Earnings		Total Arbor Realty Trust, Inc. Stockholders’ Equity		Noncontrolling Interest		Total Equity
Balance – July 1, 2023	42,585,589	$	633,684	183,067,388	$	1,831	$	2,280,632	$	107,561	$	3,023,708	$	135,933	$	3,159,641
Issuance - common stock	—	—		5,576,496	55		83,937		—		83,992		—		83,992
Stock-based compensation, net	—	—		(142,242)	(1)		(174)		—		(175)		—		(175)
Distributions - common stock	—	—		—	—		—		(80,660)		(80,660)		—		(80,660)
Distributions - preferred stock	—	—		—	—		—		(10,346)		(10,346)		—		(10,346)
Distributions - noncontrolling interest	—	—		—	—		—		—		—		(7,006)		(7,006)
Net income	—	—		—	—		—		88,266		88,266		6,789		95,055
Balance – September 30, 2023	42,585,589	$	633,684	188,501,642	$	1,885	$	2,364,395	$	104,821	$	3,104,785	$	135,716	$	3,240,501
Nine Months Ended September 30, 2023
Balance – January 1, 2023	42,585,589	$	633,684	178,230,522	$	1,782	$	2,204,481	$	97,049	$	2,936,996	$	134,883	$	3,071,879
Issuance - common stock	—	—		13,113,296	130		193,530		—		193,660		—		193,660
Repurchase - common stock	—	—		(3,545,604)	(36)		(37,396)		—		(37,432)		—		(37,432)
Stock-based compensation, net	—	—		703,428	9		3,780		—		3,789		—		3,789
Distributions - common stock	—	—		—	—		—		(230,632)		(230,632)		—		(230,632)
Distributions - preferred stock	—	—		—	—		—		(31,030)		(31,030)		—		(31,030)
Distributions - noncontrolling interest	—	—		—	—		—		—		—		(20,367)		(20,367)
Net income	—	—		—	—		—		269,434		269,434		21,200		290,634
Balance – September 30, 2023	42,585,589	$	633,684	188,501,642	$	1,885	$	2,364,395	$	104,821	$	3,104,785	$	135,716	$	3,240,501

See Notes to Consolidated Financial Statements.

4

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Unaudited) (Continued)

($ in thousands, except shares)

Three Months Ended September 30, 2022
	Preferred Stock Shares	Preferred Stock Value		Common Stock Shares	Common Stock Par Value		Additional Paid-in Capital		Retained Earnings		Total Arbor Realty Trust, Inc. Stockholders’ Equity		Noncontrolling Interest		Total Equity
Balance - July 1, 2022	42,585,589	$	633,684	168,454,805	$	1,685	$	2,060,837	$	83,271	$	2,779,477	$	133,519	$	2,912,996
Issuance - common stock	—	—		3,170,688	31		44,491		—		44,522		—		44,522
Stock-based compensation, net	—	—		(101,685)	(1)		581		—		580		—		580
Distributions - common stock	—	—		—	—		—		(66,447)		(66,447)		—		(66,447)
Distributions - preferred stock	—	—		—	—		—		(10,345)		(10,345)		—		(10,345)
Distributions - noncontrolling interest	—	—		—	—		—		—		—		(6,354)		(6,354)
Net income	—	—		—	—		—		73,052		73,052		6,002		79,054
Balance – September 30, 2022	42,585,589	$	633,684	171,523,808	$	1,715	$	2,105,909	$	79,531	$	2,820,839	$	133,167	$	2,954,006
Nine Months Ended September 30, 2022
Balance - January 1, 2022	39,325,095	$	556,163	151,362,181	$	1,514	$	1,789,229	$	68,144	$	2,415,050	$	132,487	$	2,547,537
Issuance - common stock	—	—		19,625,788	196		312,570		—		312,766		—		312,766
Issuance - Series F preferred stock	3,292,000	77,522		—	—		(130)		—		77,392		—		77,392
Stock-based compensation, net	—	—		535,839	5		4,240		—		4,245		—		4,245
Distributions - common stock	—	—		—	—		—		(185,285)		(185,285)		—		(185,285)
Distributions - preferred stock	—	—		—	—		—		(30,618)		(30,618)		—		(30,618)
Distributions - noncontrolling interest	—	—		—	—		—		—		—		(18,586)		(18,586)
Redemption - operating partnership units	(31,506)	(1)		—	—		—		—		(1)		(545)		(546)
Net income	—	—		—	—		—		227,290		227,290		19,811		247,101
Balance – September 30, 2022	42,585,589	$	633,684	171,523,808	$	1,715	$	2,105,909	$	79,531	$	2,820,839	$	133,167	$	2,954,006

See Notes to Consolidated Financial Statements.

5

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(in thousands)

	Nine Months Ended September 30,
	2023		2022
Operating activities:
Net income	$	290,634	$	247,101
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	7,297		6,092
Stock-based compensation	12,141		12,330
Amortization and accretion of interest and fees, net	(3,084)		(10,022)
Amortization of capitalized mortgage servicing rights	46,920		44,532
Originations of loans held-for-sale	(3,619,570)		(3,232,962)
Proceeds from sales of loans held-for-sale, net of gain on sale	3,607,665		3,699,555
Mortgage servicing rights	(48,769)		(52,287)
Write-off of capitalized mortgage servicing rights from payoffs	11,764		37,318
Provision for loss sharing (net of recoveries)	12,528		(2,199)
Provision for credit losses (net of recoveries)	55,047		9,700
Net charge-offs for loss sharing obligations	(434)		(354)
Deferred tax benefit	(6,630)		(7,833)
Income from equity affiliates	(20,694)		(18,507)
Distributions from operations of equity affiliates	22,507		16,546
Change in fair value of held-for-sale loans	(1,634)		12,163
Loss on extinguishment of debt	1,561		4,612
Payoffs and paydowns of loans held-for-sale	463		58,339
Loss on sale of loans	—		10,120
Changes in operating assets and liabilities	(209,214)		(23,138)
Net cash provided by operating activities	158,498		811,106
Investing Activities:
Loans and investments funded, originated and purchased, net	(1,061,865)		(5,418,113)
Payoffs and paydowns of loans and investments	2,541,373		2,302,874
Proceeds from sale of loans and investments	—		397,338
Deferred fees	13,624		50,385
Contributions to equity affiliates	(1,029)		(16,730)
Distributions from equity affiliates	15,552		24,321
Purchase of securities held-to-maturity, net	—		(27,598)
Payoffs and paydowns of securities held-to-maturity	3,544		16,676
Due to borrowers and reserves	(92,358)		(152,036)
Net cash provided by (used in) investing activities	1,418,841		(2,822,883)
Financing activities:
Proceeds from credit and repurchase facilities	6,575,575		8,474,821
Paydowns and payoffs of credit and repurchase facilities	(7,033,287)		(8,325,608)
Payoffs and paydowns of securitized debt	(856,864)		(441,000)
Proceeds from issuance of common stock	193,660		312,766
Proceeds from issuance of senior unsecured notes	95,000		—
Payoffs and paydowns of senior unsecured notes	(149,600)		—
Payments of withholding taxes on net settlement of vested stock	(8,352)		(8,085)
Repurchase of common stock	(37,432)		—
Distributions to stockholders	(282,029)		(234,246)
Payment of deferred financing costs	(7,719)		(35,267)
Proceeds from issuance of securitized debt	—		2,525,624
Proceeds from issuance of convertible senior unsecured notes	—		287,500
Extinguishment of convertible senior unsecured notes	—		(200,662)
Proceeds from issuance of preferred stock	—		77,392
Redemption of operating partnership units	—		(546)
Net cash (used in) provided by financing activities	(1,511,048)		2,432,689
Net increase in cash, cash equivalents and restricted cash	66,291		420,912
Cash, cash equivalents and restricted cash at beginning of period	1,248,165		891,270
Cash, cash equivalents and restricted cash at end of period	$	1,314,456	$	1,312,182

See Notes to Consolidated Financial Statements.

6

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Continued)

(in thousands)

	Nine Months Ended September 30,
	2023		2022
Reconciliation of cash, cash equivalents and restricted cash:
Cash and cash equivalents at beginning of period	$	534,357	$	404,580
Restricted cash at beginning of period	713,808		486,690
Cash, cash equivalents and restricted cash at beginning of period	$	1,248,165	$	891,270
Cash and cash equivalents at end of period	$	895,298	$	389,651
Restricted cash at end of period	419,158		922,531
Cash, cash equivalents and restricted cash at end of period	$	1,314,456	$	1,312,182
Supplemental cash flow information:
Cash used to pay interest	$	654,108	$	306,671
Cash used to pay taxes	22,916		25,770
Supplemental schedule of non-cash investing and financing activities:
Distributions accrued on preferred stock	7,010		7,010
Cumulative-effect adjustment (adoption of convertible debt standard)	—		2,447

See Notes to Consolidated Financial Statements.

7

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Note 1 — Description of Business

Arbor Realty Trust, Inc. (“we,” “us,” or “our”) is a Maryland corporation formed in 2003. We are a nationwide real estate investment trust (“REIT”) and direct lender, providing loan origination and servicing for commercial real estate assets. We operate through two business segments: our Structured Loan Origination and Investment Business, or “Structured Business,” and our Agency Loan Origination and Servicing Business, or “Agency Business.”

Through our Structured Business, we invest in a diversified portfolio of structured finance assets in the multifamily, single-family rental (“SFR”) and commercial real estate markets, primarily consisting of bridge loans, in addition to mezzanine loans, junior participating interests in first mortgages and preferred and direct equity. We also invest in real estate-related joint ventures and may directly acquire real property and invest in real estate-related notes and certain mortgage-related securities.

Through our Agency Business, we originate, sell and service a range of multifamily finance products through the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac,” and together with Fannie Mae, the government-sponsored enterprises, or “GSEs”), the Government National Mortgage Association (“Ginnie Mae”), Federal Housing Authority (“FHA”) and the U.S. Department of Housing and Urban Development (together with Ginnie Mae and FHA, “HUD”). We retain the servicing rights and asset management responsibilities on substantially all loans we originate and sell under the GSE and HUD programs. We are an approved Fannie Mae Delegated Underwriting and Servicing (“DUS”) lender nationally, a Freddie Mac Multifamily Conventional Loan lender, seller/servicer in New York, New Jersey and Connecticut, a Freddie Mac affordable, manufactured housing, senior housing and small balance loan (“SBL”) lender, seller/servicer nationally and a HUD MAP and LEAN senior housing/healthcare lender nationally. We also originate and service permanent financing loans underwritten using the guidelines of our existing agency loans sold to the GSEs, which we refer to as “Private Label” loans, and originate and sell finance products through conduit/commercial mortgage-backed securities (“CMBS”) programs. We pool and securitize the Private Label loans and sell certificates in the securitizations to third-party investors, while retaining the servicing rights and the highest risk bottom tranche certificate of the securitization (“APL certificates”).

Substantially all of our operations are conducted through our operating partnership, Arbor Realty Limited Partnership (“ARLP”), for which we serve as the indirect general partner, and ARLP’s subsidiaries. We are organized to qualify as a REIT for U.S. federal income tax purposes. A REIT is generally not subject to federal income tax on that portion of its REIT-taxable income that is distributed to its stockholders, provided that at least 90% of taxable income is distributed and provided that certain other requirements are met. Certain of our assets that produce non-qualifying REIT income, primarily within the Agency Business, are operated through taxable REIT subsidiaries (“TRS”), which are part of our TRS consolidated group (the “TRS Consolidated Group”) and are subject to U.S. federal, state and local income taxes. In general, our TRS entities may hold assets that the REIT cannot hold directly and may engage in real estate or non-real estate-related business.

Note 2 — Basis of Presentation and Significant Accounting Policies

Basis of Presentation

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), for interim financial statements and the instructions to Form 10-Q. Accordingly, certain information and footnote disclosures normally included in the consolidated financial statements prepared under GAAP have been condensed or omitted. In our opinion, all adjustments considered necessary for a fair presentation of our financial position, results of operations and cash flows have been included and are of a normal and recurring nature. The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. These financial statements should be read in conjunction with our financial statements and notes thereto included in our 2022 Annual Report.

Principles of Consolidation

The consolidated financial statements include our financial statements and the financial statements of our wholly owned subsidiaries, partnerships and other entities in which we own a controlling interest, including variable interest entities (“VIEs”) of which we are the primary beneficiary. Entities in which we have a significant influence are accounted for under the equity method. Our VIEs are described in Note 14. All significant intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that could materially affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The ultimate impact of inflation, increasing interest rates, bank failures, tightening of capital markets and

8

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

reduced property values, both globally and to our business, makes any estimate or assumption at September 30, 2023 inherently less certain.

Reclassification

Certain amounts in the prior period financial statements have been reclassified to conform to the presentation of the current period financial statements.

Recently Adopted Accounting Pronouncements

Description	Adoption Date	Effect on Financial Statements
In March 2022, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2022-02, Financial Instruments—Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures. This guidance eliminates the accounting guidance on troubled debt restructurings and amends existing disclosures, including the requirement to disclose current period gross write-offs by year of origination. The guidance also updates the requirements related to accounting for credit losses and adds enhanced disclosures for creditors with respect to loan refinancings and restructurings for borrowers experiencing financial difficulty.	First quarter of 2023	The adoption of this guidance did not have a material impact on our consolidated financial statements.

Recently Issued Accounting Pronouncements

In March 2023, the FASB issued ASU 2023-01, Leases (Topic 842) – Common Control Arrangements and ASU 2023-02, Investments – Equity Method and Joint Ventures: Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method, both effective for us in the first quarter of 2024. In August 2023, the FASB issued ASU 2023-05, Business Combinations – Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement, which is effective for joint venture entities with a formation date on or after January 1, 2025. We currently do not have any transactions that fall under the scope of these ASUs; therefore, the adoptions are not expected to have an impact on our consolidated financial statements.

Significant Accounting Policies

See Item 8 – Financial Statements and Supplementary Data in our 2022 Annual Report for a description of our significant accounting policies. There have been no significant changes to our significant accounting policies since December 31, 2022.

9

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Note 3 — Loans and Investments

Our Structured Business loan and investment portfolio consists of ($ in thousands):

	September 30, 2023		Percent of Total		Loan Count	Wtd. Avg. Pay Rate (1)		Wtd. Avg. Remaining Months to Maturity	Wtd. Avg. First Dollar LTV Ratio (2)		Wtd. Avg. Last Dollar LTV Ratio (3)
Bridge loans (4)	$	12,790,972	97	%	664	8.85	%	13.8	0	%	77	%
Mezzanine loans	233,805		2	%	47	8.35	%	54.7	45	%	79	%
Preferred equity investments	87,924		1	%	10	3.03	%	62.0	47	%	84	%
Other loans (5)	9,694		<1%		2	9.72	%	15.6	0	%	62	%
	13,122,395		100	%	723	8.80	%	14.9	1	%	77	%
Allowance for credit losses	(184,069)
Unearned revenue	(45,530)
Loans and investments, net	$	12,892,796
	December 31, 2022
Bridge loans (4)	$	14,096,054	98	%	692	8.17	%	19.8	0	%	76	%
Mezzanine loans	213,499		1	%	44	8.13	%	63.1	42	%	77	%
Preferred equity investments	110,725		1	%	8	7.63	%	39.2	46	%	79	%
Other loans (5)	35,845		<1%		3	8.76	%	32.8	0	%	58	%
	14,456,123		100	%	747	8.17	%	20.6	1	%	76	%
Allowance for credit losses	(132,559)
Unearned revenue	(68,890)
Loans and investments, net	$	14,254,674

________________________

(1)“Weighted Average Pay Rate” is a weighted average, based on the unpaid principal balance (“UPB”) of each loan in our portfolio, of the interest rate required to be paid monthly as stated in the individual loan agreements. Certain loans and investments that require an accrual rate to be paid at maturity are not included in the weighted average pay rate as shown in the table.

(2)The “First Dollar Loan-to-Value (“LTV”) Ratio” is calculated by comparing the total of our senior most dollar and all senior lien positions within the capital stack to the fair value of the underlying collateral to determine the point at which we will absorb a total loss of our position.

(3)The “Last Dollar LTV Ratio” is calculated by comparing the total of the carrying value of our loan and all senior lien positions within the capital stack to the fair value of the underlying collateral to determine the point at which we will initially absorb a loss.

(4)At September 30, 2023 and December 31, 2022, bridge loans included 311 and 241, respectively, of SFR loans with a total gross loan commitment of $2.05 billion and $1.57 billion, respectively, of which $1.16 billion and $927.4 million, respectively, was funded.

(5)Other loans represents variable rate SFR permanent loans.

Concentration of Credit Risk

We are subject to concentration risk in that, at September 30, 2023, the UPB related to 92 loans with five different borrowers represented 12% of total assets. At December 31, 2022, the UPB related to 38 loans with five different borrowers represented 11% of total assets. During both the three and nine months ended September 30, 2023 and the year ended December 31, 2022, no single loan or investment represented more than 10% of our total assets and no single investor group generated over 10% of our revenue. See Note 17 for details on our concentration of related party loans and investments.

We assign a credit risk rating of pass, pass/watch, special mention, substandard or doubtful to each loan and investment, with a pass rating being the lowest risk and a doubtful rating being the highest risk. Each credit risk rating has benchmark guidelines that pertain to debt-service coverage ratios, LTV ratios, borrower strength, asset quality, and funded cash reserves. Other factors such as guarantees, market strength, and remaining loan term and borrower equity are also reviewed and factored into determining the credit risk rating assigned to each loan. This metric provides a helpful snapshot of portfolio quality and credit risk. All portfolio assets are subject to, at a minimum, a

10

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

thorough quarterly financial evaluation in which historical operating performance and forward-looking projections are reviewed, however, we maintain a higher level of scrutiny and focus on loans that we consider “high risk” and that possess deteriorating credit quality.

Generally speaking, given our typical loan profile, risk ratings of pass, pass/watch and special mention suggest that we expect the loan to make both principal and interest payments according to the contractual terms of the loan agreement. A risk rating of substandard indicates we anticipate the loan may require a modification of some kind. A risk rating of doubtful indicates we expect the loan to underperform over its term, and there could be loss of interest and/or principal. Further, while the above are the primary guidelines used in determining a certain risk rating, subjective items such as borrower strength, market strength or asset quality may result in a rating that is higher or lower than might be indicated by any risk rating matrix.

A summary of the loan portfolio’s internal risk ratings and LTV ratios by asset class at September 30, 2023 is as follows ($ in thousands):

	UPB by Origination Year												Total			Wtd. Avg. First Dollar LTV Ratio		Wtd. Avg. Last Dollar LTV Ratio
Asset Class / Risk Rating	2023		2022		2021		2020		2019		Prior
Multifamily:
Pass	$	97,186	$	131,266	$	97,269	$	2,010	$	—	$	20,300	$	348,031
Pass/Watch	673,165		2,378,519		3,015,502		81,560		112,416		58,394		6,319,556
Special Mention	799		1,830,803		2,353,938		219,050		140,685		—		4,545,275
Substandard	—		290,492		153,697		24,099		—		—		468,288
Doubtful	—		—		13,930		—		9,765		—		23,695
Total Multifamily	$	771,150	$	4,631,080	$	5,634,336	$	326,719	$	262,866	$	78,694	$	11,704,845		1	%	78	%
Single-Family Rental:	Percentage of portfolio												89		%
Pass	$	22,208	$	—	$	—	$	—	$	—	$	—	$	22,208
Pass/Watch	161,976		466,391		355,176		86,347		20,965		—		1,090,855
Special Mention	—		22,924		12,852		24,503		—		—		60,279
Total Single-Family Rental	$	184,184	$	489,315	$	368,028	$	110,850	$	20,965	$	—	$	1,173,342		0	%	63	%
Land:	Percentage of portfolio												9		%
Pass/Watch	$	—	$	—	$	—	$	4,600	$	—	$	—	$	4,600
Special Mention	—		—		—		3,500		—		—		3,500
Substandard	—		—		—		—		—		127,928		127,928
Total Land	$	—	$	—	$	—	$	8,100	$	—	$	127,928	$	136,028		0	%	98	%
Office:	Percentage of portfolio												1		%
Special Mention	$	—	$	—	$	—	$	35,410	$	—	$	—	$	35,410
Substandard	—		—		—		—		—		45,025		45,025
Total Office	$	—	$	—	$	—	$	35,410	$	—	$	45,025	$	80,435		0	%	90	%
Retail:	Percentage of portfolio												1		%
Pass/Watch	$	—	$	—	$	—	$	—	$	4,000	$	—	$	4,000
Special Mention	—		—		—		—		—		3,445		3,445
Substandard	—		—		—		—		—		18,600		18,600
Total Retail	$	—	$	—	$	—	$	—	$	4,000	$	22,045	$	26,045		11	%	71	%
Other:	Percentage of portfolio												< 1%
Doubtful	$	—	$	—	$	—	$	—	$	—	$	1,700	$	1,700
Total Other	$	—	$	—	$	—	$	—	$	—	$	1,700	$	1,700		63	%	63	%
	Percentage of portfolio												< 1%
Grand Total	$	955,334	$	5,120,395	$	6,002,364	$	481,079	$	287,831	$	275,392	$	13,122,395		1	%	77	%

Geographic Concentration Risk

At September 30, 2023, underlying properties in Texas and Florida represented 24% and 16%, respectively, of the outstanding balance of our loan and investment portfolio. At December 31, 2022, underlying properties in Texas and Florida represented 22% and 14%, respectively, of the outstanding balance of our loan and investment portfolio. No other states represented 10% or more of the total loan and investment portfolio.

11

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Allowance for Credit Losses

A summary of the changes in the allowance for credit losses is as follows (in thousands):

	Three Months Ended September 30, 2023
	Multifamily		Land		Office		Retail		Commercial		Single-Family Rental		Other		Total
Allowance for credit losses:
Beginning balance	$	74,295	$	77,902	$	8,246	$	5,819	$	1,700	$	1,077	$	15	$	169,054
Provision for credit losses (net of recoveries)	14,884		60		(76)		—		—		162		(15)		15,015
Ending balance	$	89,179	$	77,962	$	8,170	$	5,819	$	1,700	$	1,239	$	—	$	184,069
	Three Months Ended September 30, 2022
Allowance for credit losses:
Beginning balance	$	27,958	$	77,918	$	7,031	$	5,819	$	1,700	$	725	$	180	$	121,331
Provision for credit losses (net of recoveries)	(675)		(8)		306		—		—		1,326		16		965
Ending balance	$	27,283	$	77,910	$	7,337	$	5,819	$	1,700	$	2,051	$	196	$	122,296
	Nine Months Ended September 30, 2023
Allowance for credit losses:
Beginning balance	$	37,961	$	78,068	$	8,162	$	5,819	$	1,700	$	781	$	68	$	132,559
Provision for credit losses (net of recoveries)	51,218		(106)		8		—		—		458		(68)		51,510
Ending balance	$	89,179	$	77,962	$	8,170	$	5,819	$	1,700	$	1,239	$	—	$	184,069
	Nine Months Ended September 30, 2022
Allowance for credit losses:
Beginning balance	$	18,707	$	77,970	$	8,073	$	5,819	$	1,700	$	320	$	652	$	113,241
Provision for credit losses (net of recoveries)	8,576		(60)		(736)		—		—		1,731		(456)		9,055
Ending balance	$	27,283	$	77,910	$	7,337	$	5,819	$	1,700	$	2,051	$	196	$	122,296

During the three and nine months ended September 30, 2023, we recorded a $15.0 million and a $51.5 million provision for credit losses, respectively. The increase in the provision for credit losses during the three and nine months ended September 30, 2023 was primarily attributable to the impact from the macroeconomic outlook of the commercial real estate market. Our estimate of allowance for credit losses on our structured loans and investments, including related unfunded loan commitments, was based on a reasonable and supportable forecast period that reflects recent observable data, including an increase in interest rates, higher unemployment forecasts, and continuing inflationary pressures, including an estimated continual decline in real estate values and other market factors.

The expected credit losses over the contractual period of our loans also include the obligation to extend credit through our unfunded loan commitments. Our current expected credit loss (“CECL”) allowance for unfunded loan commitments is adjusted quarterly and corresponds with the associated outstanding loans. At September 30, 2023 and December 31, 2022, we had outstanding unfunded commitments of $1.08 billion and $1.15 billion, respectively, that we are obligated to fund as borrowers meet certain requirements.

At September 30, 2023 and December 31, 2022, accrued interest receivable related to our loans totaling $116.4 million and $108.5 million, respectively, was excluded from the estimate of credit losses and is included in other assets on the consolidated balance sheets.

12

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

All of our structured loans and investments are secured by real estate assets or by interests in real estate assets, and, as such, the measurement of credit losses may be based on the difference between the fair value of the underlying collateral and the carrying value of the assets as of the period end. A summary of our specific loans considered impaired by asset class is as follows ($ in thousands):

	September 30, 2023
Asset Class	UPB (1)		Carrying Value		Allowance for Credit Losses		Wtd. Avg. First Dollar LTV Ratio		Wtd. Avg. Last Dollar LTV Ratio
Land	$	134,215	$	127,868	$	77,869	0	%	99	%
Multifamily	90,070		87,995		17,750		0	%	100	%
Office	45,025		45,025		7,951		0	%	99	%
Retail	22,045		17,670		5,817		13	%	78	%
Commercial	1,700		1,700		1,700		63	%	63	%
Total	$	293,055	$	280,258	$	111,087	1	%	97	%
	December 31, 2022
Land	$	134,215	$	127,868	$	77,869	0	%	99	%
Retail	22,045		17,563		5,817		14	%	79	%
Commercial	1,700		1,700		1,700		63	%	63	%
Total	$	157,960	$	147,131	$	85,386	3	%	96	%

________________________

(1)Represents the UPB of thirteen and seven impaired loans (less unearned revenue and other holdbacks and adjustments) by asset class at September 30, 2023 and December 31, 2022, respectively.

There were no loans for which the fair value of the collateral securing the loan was less than the carrying value of the loan for which we had not recorded a provision for credit loss at September 30, 2023 and December 31, 2022.

Loans are classified as non-performing once the contractual payments reach 60 days past due. Income from non-performing loans is generally recognized on a cash basis when it is received. Full income recognition will resume when the loan becomes contractually current, and performance has recommenced. At September 30, 2023, twelve loans with an aggregate net carrying value of $137.9 million, net of loan loss reserves of $12.6 million, were classified as non-performing and, at December 31, 2022, four loans with an aggregate net carrying value of $2.6 million, net of related loan loss reserves of $5.1 million, were classified as non-performing.

A summary of our non-performing loans by asset class is as follows (in thousands):

	September 30, 2023						December 31, 2022
	UPB		Less Than 90 Days Past Due		Greater Than 90 Days Past Due		UPB		Less Than 90 Days Past Due		Greater Than 90 Days Past Due
Multifamily	$	152,717	$	122,847	$	29,870	$	2,605	$	—	$	2,605
Retail	3,445		—		3,445		3,445		—		3,445
Commercial	1,700		—		1,700		1,700		—		1,700
Total	$	157,862	$	122,847	$	35,015	$	7,750	$	—	$	7,750

At both September 30, 2023 and December 31, 2022, we had no loans contractually past due 90 days or more that are still accruing interest. During the nine months ended September 30, 2023 and 2022, we received $2.8 million and zero, respectively, of interest income on non-accrual loans.

In addition, we have six loans with a carrying value totaling $121.4 million at September 30, 2023, that are collateralized by a land development project. The loans do not carry a current pay rate of interest, however, five of the loans with a carrying value totaling $112.1 million entitle us to a weighted average accrual rate of interest of 7.91%. In 2008, we suspended the recording of the accrual rate of interest on these loans, as they were impaired and we deemed the collection of this interest to be doubtful. At both September 30, 2023 and December 31, 2022, we had a cumulative allowance for credit losses of $71.4 million related to these loans. The loans are subject to certain risks associated with a development project including, but not limited to, availability of construction financing, increases in

13

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

projected construction costs, demand for the development’s outputs upon completion of the project, and litigation risk. Additionally, these loans were not classified as non-performing as the borrower is compliant with all of the terms and conditions of the loans.

In the second quarter of 2023, a borrower of a $70.5 million multifamily bridge loan, with an interest rate of SOFR plus 3.40% and a maturity date of September 2024, defaulted on its interest payments and, as a result, this loan was classified as a non-performing loan. In September 2023, the borrower sold the underlying property to a third party who assumed our loan. At the time of the property sale, we entered into a loan modification agreement with the new borrower to extend the maturity to September 2025 and reduce the interest rate to a fixed pay rate of 3.00% and an accrual rate of 3.00% for a total fixed rate of 6.00% for a period of eighteen months, after which the interest rate resumes to the original rate for the duration of the loan. The new borrower was also required to fund $10.5 million over time: $2.5 million in interest reserves, which was funded at the closing of the loan assumption, and $8.0 million in capital improvements within fifteen months. If the new borrower fails to timely complete the required capital improvements, it will be required to fund a renovation reserve at the lesser of (1) $2.5 million and (2) the difference between the $8.0 million capital commitment and the costs actually incurred for such capital improvements. The key principal is also personally guaranteeing the $8.0 million capital improvement.

There were no other loan modifications, refinancings and/or extensions during the three and nine months ended September 30, 2022 to borrowers experiencing financial difficulty.

In April 2023, we exercised our right to foreclose on a group of properties in Houston, Texas that are the underlying collateral for four bridge loans with a total UPB of $217.4 million. We simultaneously sold these properties to a significant equity investor in the original bridge loans and provided new bridge loan financing as part of the sale. We did not record a loss on the original bridge loans and recovered all the outstanding interest owed to us as part of this restructuring.

During the second quarter of 2022, we sold a bridge loan and mezzanine loans totaling $110.5 million, that were collateralized by a land development project, at a discount for $102.2 million. In connection with this transaction, we had $66.3 million of capital returned to us to be used in future investments and recorded a $9.2 million loss (including fees and expenses), which was included in other income (loss), net on the consolidated statements of income. We have the potential to recover up to $2.8 million depending on the future performance of the loan.

In July 2022, we sold four bridge loans with an aggregate UPB of $296.9 million at par less shared loan origination fees and selling costs totaling $2.0 million and had $78.0 million of capital returned to us to be used in future investments. The shared loan origination fees and selling costs were recorded as an unrealized impairment loss in the second quarter of 2022 and included in other income (loss), net on the consolidated statements of income. We have retained the right to service these loans. During the three months ended June 30, 2023, we repurchased two of these bridge loans with an aggregate UPB of $182.0 million at par.

Given the transitional nature of some of our real estate loans, we may require funds to be placed into an interest reserve, based on contractual requirements, to cover debt service costs. At September 30, 2023 and December 31, 2022, we had total interest reserves of $125.8 million and $123.7 million, respectively, on 516 loans and 480 loans, respectively, with an aggregate UPB of $8.31 billion and $7.70 billion, respectively.

Note 4 — Loans Held-for-Sale, Net

Our GSE loans held-for-sale are typically sold within 60 days of loan origination, while our non-GSE loans are generally expected to be sold to third parties or securitized within 180 days of loan origination. Loans held-for-sale, net consists of the following (in thousands):

	September 30, 2023		December 31, 2022
Fannie Mae	$	257,371	$	173,020
Freddie Mac	86,089		8,938
Private Label	11,350		152,735
SFR - Fixed Rate	8,710		12,352
FHA	4,810		21,021
	368,330		368,066
Fair value of future MSR	4,302		5,557
Unrealized impairment loss	(2,891)		(15,703)
Unearned discount	(5,421)		(3,850)
Loans held-for-sale, net	$	364,320	$	354,070

14

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

During the three and nine months ended September 30, 2023, we sold $1.28 billion and $3.62 billion of loans held-for-sale, respectively, and $1.08 billion and $3.70 billion during the three and nine months ended September 30, 2022, respectively. Included in the total loans sold during 2022 were $489.3 million of Private Label loans that were sold to unconsolidated affiliates of ours who securitized the loans. We retained the most subordinate class of certificates in this securitization totaling $43.4 million in satisfaction of credit risk retention requirements and we are also the primary servicer of the mortgage loans.

During 2022, we recorded a loss of $5.2 million (net of corresponding swap gains associated with these loans) on seven Private Label loans with a UPB of $129.9 million and a net carrying value of $116.4 million. During the first quarter of 2023, we sold these loans and recorded a gain of $0.9 million.

During the three months ended June 30, 2022, we determined that the fair value of certain loans held-for-sale were below their carrying values and, based on the fair value analysis performed, we recorded an unrealized impairment loss of $4.1 million. The unrealized impairment loss was included in other income (loss), net on the consolidated statements of income.

At September 30, 2023 and December 31, 2022, there were no loans held-for-sale that were 90 days or more past due, and there were no loans held-for-sale that were placed on a non-accrual status.

Note 5 — Capitalized Mortgage Servicing Rights

Our capitalized mortgage servicing rights (“MSRs”) reflect commercial real estate MSRs derived primarily from loans sold in our Agency Business or acquired MSRs. The discount rates used to determine the present value of all our MSRs throughout the periods presented were between 8% - 13% (representing a weighted average discount rate of 12%) based on our best estimate of market discount rates. The weighted average estimated life remaining of our MSRs was 8.3 years and 8.6 years at September 30, 2023 and December 31, 2022, respectively.

A summary of our capitalized MSR activity is as follows (in thousands):

	Three Months Ended September 30, 2023						Nine Months Ended September 30, 2023
	Originated		Acquired		Total		Originated		Acquired		Total
Beginning balance	$	383,267	$	11,143	$	394,410	$	386,878	$	14,593	$	401,471
Additions	16,550		—		16,550		49,416		—		49,416
Amortization	(14,988)		(912)		(15,900)		(43,866)		(3,054)		(46,920)
Write-downs and payoffs	(2,400)		(457)		(2,857)		(9,999)		(1,765)		(11,764)
Ending balance	$	382,429	$	9,774	$	392,203	$	382,429	$	9,774	$	392,203
	Three Months Ended September 30, 2022						Nine Months Ended September 30, 2022
Beginning balance	$	391,397	$	20,137	$	411,534	$	395,573	$	27,161	$	422,734
Additions	18,907		—		18,907		63,002		—		63,002
Amortization	(13,355)		(1,427)		(14,782)		(39,348)		(5,184)		(44,532)
Write-downs and payoffs	(9,957)		(1,816)		(11,773)		(32,235)		(5,083)		(37,318)
Ending balance	$	386,992	$	16,894	$	403,886	$	386,992	$	16,894	$	403,886

We collected prepayment fees totaling $1.0 million and $6.1 million during the three and nine months ended September 30, 2023, respectively, and $11.2 million and $42.6 million during the three and nine months ended September 30, 2022, respectively. Prepayment fees are included as a component of servicing revenue, net on the consolidated statements of income. At September 30, 2023 and December 31, 2022, we had no valuation allowance recorded on any of our MSRs.

15

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

The expected amortization of capitalized MSRs recorded at September 30, 2023 is as follows (in thousands):

Year	Amortization
2023 (three months ending 12/31/2023)	$	16,169
2024	63,855
2025	60,481
2026	54,479
2027	49,654
2028	43,110
Thereafter	104,455
Total	$	392,203

Based on scheduled maturities, actual amortization may vary from these estimates.

Note 6 — Mortgage Servicing

Product and geographic concentrations that impact our servicing revenue are as follows ($ in thousands):

September 30, 2023
Product Concentrations					Geographic Concentrations
Product	UPB (1)		% of Total		State	UPB % of Total
Fannie Mae	$	20,463,620	68	%	Texas	11	%
Freddie Mac	5,184,888		17	%	New York	11	%
Private Label	2,371,475		8	%	North Carolina	8	%
FHA	1,322,832		5	%	California	8	%
Bridge (2)	305,950		1	%	Georgia	6	%
SFR - Fixed Rate	287,942		1	%	Florida	6	%
Total	$	29,936,707	100	%	New Jersey	5	%
					Illinois	4	%
					Other (3)	41	%
					Total	100	%
December 31, 2022
Fannie Mae	$	19,038,124	68	%	Texas	11	%
Freddie Mac	5,153,207		18	%	New York	11	%
Private Label	2,074,859		8	%	California	8	%
FHA	1,155,893		4	%	North Carolina	8	%
Bridge (2)	301,182		1	%	Georgia	6	%
SFR - Fixed Rate	274,764		1	%	Florida	5	%
Total	$	27,998,029	100	%	New Jersey	5	%
					Illinois	4	%
					Other (3)	42	%
					Total	100	%

________________________

(1)Excludes loans which we are not collecting a servicing fee.

(2)Represents bridge loans that were either sold by our Structured Business or refinanced by a third-party lender which we retained the right to service.

(3)No other individual state represented 4% or more of the total.

16

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

At September 30, 2023 and December 31, 2022, our weighted average servicing fee was 39.7 basis points and 41.1 basis points, respectively. At both September 30, 2023 and December 31, 2022, we held total escrow balances (including unfunded collateralized loan obligation holdbacks) of approximately $1.7 billion, of which approximately $1.6 billion and $1.5 billion, respectively, are not included in our consolidated balance sheets. These escrows are maintained in separate accounts at several federally insured depository institutions, which may exceed FDIC insured limits. We earn interest income on the total escrow deposits, which is generally based on a market rate of interest negotiated with the financial institutions that hold the escrow deposits. Interest earned on total escrows, net of interest paid to the borrower, is included as a component of servicing revenue, net in the consolidated statements of income as noted in the following table.

The components of servicing revenue, net are as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Servicing fees	$	32,191	$	30,631	$	92,479	$	93,702
Interest earned on escrows	20,985		7,450		57,501		10,073
Prepayment fees	1,044		11,218		6,080		42,588
Write-offs of MSRs	(2,857)		(11,773)		(11,764)		(37,318)
Amortization of MSRs	(15,900)		(14,782)		(46,920)		(44,532)
Servicing revenue, net	$	35,463	$	22,744	$	97,376	$	64,513

Note 7 — Securities Held-to-Maturity

Agency Private Label Certificates (“APL certificates”). In connection with our Private Label securitizations, we retain the most subordinate class of the APL certificates in satisfaction of credit risk retention requirements. At September 30, 2023, we held APL certificates with an initial face value of $192.8 million, which were purchased at a discount for $119.0 million. These certificates are collateralized by 5-year to 10-year fixed rate first mortgage loans on multifamily properties, bear interest at an initial weighted average variable rate of 3.94% and have an estimated weighted average remaining maturity of 6.8 years. The weighted average effective interest rate was 8.85% at both September 30, 2023 and December 31, 2022, including the accretion of a portion of the discount deemed collectible. At September 30, 2023, approximately $18.2 million is estimated to mature after one year through five years and $174.6 million is estimated to mature after five years through ten years.

Agency B Piece Bonds. Freddie Mac may choose to hold, sell or securitize loans we sell to them under the Freddie Mac SBL program. As part of the securitizations under the SBL program, we have the ability to purchase the B Piece bond through a bidding process, which represents the bottom 10%, or highest risk, of the securitization. At September 30, 2023, we held 49%, or $106.2 million initial face value, of seven B Piece bonds, which were purchased at a discount for $74.7 million, and sold the remaining 51% to a third party. These securities are collateralized by a pool of multifamily mortgage loans, bear interest at an initial weighted average variable rate of 3.74% and have an estimated weighted average remaining maturity of 5.9 years. The weighted average effective interest rate was 11.19% and 12.20% at September 30, 2023 and December 31, 2022, respectively, including the accretion of a portion of the discount deemed collectible. At September 30, 2023, approximately $7.5 million is estimated to mature within one year, $14.8 million is estimated to mature after one year through five years and $16.5 million is estimated to mature after ten years.

A summary of our securities held-to-maturity is as follows (in thousands):

	Face Value		Net Carrying Value		Unrealized Gain (Loss)		Estimated Fair Value		Allowance for Credit Losses
September 30, 2023
APL certificates	$	192,791	$	127,547	$	(33,337)	$	94,210	$	2,340
B Piece bonds	38,786		27,625		4,773		32,398		3,603
Total	$	231,577	$	155,172	$	(28,564)	$	126,608	$	5,943
December 31, 2022
APL certificates	$	192,791	$	123,475	$	(13,348)	$	110,127	$	2,783
B Piece bonds	41,464		33,072		1,372		34,444		370
Total	$	234,255	$	156,547	$	(11,976)	$	144,571	$	3,153

17

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

A summary of the changes in the allowance for credit losses for our securities held-to-maturity is as follows (in thousands):

	Three Months Ended September 30, 2023
	APL Certificates		B Piece Bonds		Total
Beginning balance	$	3,375	$	1,159	$	4,534
Provision for credit loss expense/(reversal)	(1,035)		2,444		1,409
Ending balance	$	2,340	$	3,603	$	5,943
	Nine Months Ended September 30, 2023
Beginning balance	$	2,783	$	370	$	3,153
Provision for credit loss expense/(reversal)	(443)		3,233		2,790
Ending balance	$	2,340	$	3,603	$	5,943

The allowance for credit losses on our held-to-maturity securities was estimated on a collective basis by major security type and was based on a reasonable and supportable forecast period and a historical loss reversion for similar securities. The issuers continue to make timely principal and interest payments and we continue to accrue interest on all our securities.

We recorded interest income (including the amortization of discount) related to these investments of $3.6 million and $10.7 million during the three and nine months ended September 30, 2023, respectively, and $3.7 million and $13.9 million during the three and nine months ended September 30, 2022, respectively.

Note 8 — Investments in Equity Affiliates

We account for all investments in equity affiliates under the equity method. A summary of these investments is as follows (in thousands):

	Investments in Equity Affiliates at				UPB of Loans to Equity Affiliates at September 30, 2023
Equity Affiliates	September 30, 2023		December 31, 2022
Arbor Residential Investor LLC	$	33,447	$	46,951	$	—
Fifth Wall Ventures	13,422		13,584		—
AMAC Holdings III LLC	13,156		15,825		—
Lightstone Value Plus REIT L.P.	1,895		1,895		—
Docsumo Pte. Ltd.	450		450		—
JT Prime	425		425		—
North Vermont Avenue	—		—		—
West Shore Café	—		—		1,688
Lexford Portfolio	—		—		—
East River Portfolio	—		—		—
Total	$	62,795	$	79,130	$	1,688

Arbor Residential Investor LLC (“ARI”). During the three and nine months ended September 30, 2023, we recorded a loss of $1.3 million and income of $1.3 million, respectively, and during the three and nine months ended September 30, 2022, we recorded income of $0.3 million and $6.4 million, respectively, to income from equity affiliates in our consolidated statements of income. During the three and nine months ended September 30, 2023, we received cash distributions of $7.5 million and $15.0 million, respectively, and during the three and nine months ended September 30, 2022, we received cash distributions of $7.3 million and $22.3 million, respectively, which were classified as returns on capital. The allocation of income is based on the underlying agreements, which may be different than our indirect interest, and at September 30, 2023 was 9.2%. At September 30, 2023, our indirect interest was 12.3%.

Fifth Wall Ventures (“Fifth Wall”). During the nine months ended September 30, 2023 and 2022, we funded an additional $0.8 million and $8.7 million, respectively, and during the three and nine months ended September 30, 2023, we recorded a loss associated with this investment of $0.8 million and $1.0 million, respectively. In addition, during the three and nine months ended September 30, 2022, we received distributions from this investment of $0.7 million and $1.6 million, respectively, which were classified as a return of capital.

AMAC Holdings III LLC (“AMAC III”). During the nine months ended September 30, 2023, we received distributions of $1.1 million, which were classified as returns of capital, and, during the three and nine months ended September 30, 2023, recorded losses associated

18

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

with this investment of $0.7 million and $1.6 million, respectively. During 2022, we funded an additional $4.9 million, and during the three and nine months ended September 30, 2022, recorded losses associated with this investment of $0.7 million and $1.8 million, respectively. In addition, during the three and nine months ended September 30, 2022, we received distributions of $0.2 million and $0.4 million, respectively, which were classified as returns of capital.

Lexford Portfolio. During the nine months ended September 30, 2023, we received distributions of $7.2 million and, during the three and nine months ended September 30, 2022, we received distributions of $5.0 million and $11.0 million, respectively, which were classified as returns on capital and recognized as income from equity affiliates.

Equity Participation Interest. During the three and nine months ended September 30, 2023, we received $3.5 million and $14.5 million, respectively, and, during the three months ended September 30, 2022, we received $2.6 million from equity participation interests on properties that were sold and which we had loans that previously paid-off. These were classified as returns of capital and recognized as income from equity affiliates.

See Note 17 for details of certain investments described above.

19

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Note 9 — Debt Obligations

Credit and Repurchase Facilities

Borrowings under our credit and repurchase facilities are as follows ($ in thousands):

				September 30, 2023						December 31, 2022
	Current Maturity	Extended Maturity	Note Rate Type	Debt Carrying Value (1)		Collateral Carrying Value		Wtd. Avg. Note Rate		Debt Carrying Value (1)		Collateral Carrying Value
Structured Business
$2.5B joint repurchase facility (2)	Jul. 2025	Jul. 2026	V	$	923,599	$	1,438,971	7.72	%	$	1,516,657	$	2,099,447
$1B repurchase facility (2)	Aug. 2025	Aug. 2026	V	418,206		621,759		7.58	%	498,666		703,740
$500M repurchase facility	(5)	N/A	V	374,072		505,139		8.34	%	154,653		188,563
$499M repurchase facility (2)(3)	Oct. 2023 (6)	N/A	V	343,726		491,190		7.67	%	351,056		504,506
$450M repurchase facility	Mar. 2024	Mar. 2026	V	328,650		452,318		7.50	%	344,237		450,736
$450M repurchase facility	Jan. 2024	Oct. 2024	V	93,410		120,947		7.01	%	186,639		239,678
$250M credit facility	July 2024	N/A	V	18,438		23,088		7.28	%	33,221		43,238
$225M credit facility	Jan. 2024	Jan. 2025	V	94,913		148,041		7.97	%	47,398		81,119
$200M repurchase facility	Mar. 2025	Mar. 2026	V	73,751		105,076		7.97	%	32,494		47,750
$200M repurchase facility	Jan. 2024	Jan. 2025	V	115,748		151,890		7.36	%	154,516		200,099
$174M loan specific credit facilities	Oct. 2023 (6) to Aug. 2025	Aug. 2025 to Aug. 2027	V/F	173,862		251,049		7.45	%	156,107		225,805
$50M credit facility	Apr. 2024	Apr. 2025	V	29,200		36,500		7.51	%	29,194		36,500
$40M credit facility	Apr. 2026	Apr. 2027	V	—		—		—		—		—
$35M working capital facility	Apr. 2024	N/A	V	—		—		—		—		—
$25M credit facility	Oct. 2024	N/A	V	18,248		24,625		8.02	%	18,701		24,572
Repurchase facility - securities (2)(4)	N/A	N/A	V	31,032		—		7.11	%	12,832		—
Structured Business total				$	3,036,855	$	4,370,593	7.70	%	$	3,536,371	$	4,845,753
Agency Business
$750M ASAP agreement	N/A	N/A	V	$	54,618	$	55,220	6.46	%	$	29,476	$	30,291
$500M joint repurchase facility (2)	Jul. 2025	Jul. 2026	V	7,701		11,350		7.74	%	104,629		135,641
$500M repurchase facility	Nov. 2023	N/A	V	144,818		145,618		6.69	%	66,778		66,866
$200M credit facility	Mar. 2024	N/A	V	143,654		144,168		6.71	%	31,475		33,177
$100M credit facility	July 2024	N/A	V	—		—		—		57,887		57,974
$50M credit facility	Sept. 2024	N/A	V	3,264		3,264		6.66	%	14,664		14,671
$1M repurchase facility (2)(3)	Oct. 2023 (6)	N/A	V	531		880		7.67	%	534		920
Agency Business total				$	354,586	$	360,500	6.69	%	$	305,443	$	339,540
Consolidated total				$	3,391,441	$	4,731,093	7.59	%	$	3,841,814	$	5,185,293

________________________

V = Variable Note Rate; F = Fixed Note Rate

(1)At September 30, 2023 and December 31, 2022, debt carrying value for the Structured Business was net of unamortized deferred finance costs of $6.6 million and $13.3 million, respectively, and for the Agency Business was net of unamortized deferred finance costs of $0.5 million and $0.9 million, respectively.

(2)These facilities are subject to margin call provisions associated with changes in interest spreads.

(3)A portion of this facility was used to finance a fixed-rate SFR permanent loan reported through our Agency Business.

(4)At September 30, 2023, this facility was collateralized by certificates retained by us from our Freddie Mac Q Series securitization (“Q Series securitization”) with a principal balance of $44.4 million. At December 31, 2022, this facility was collateralized by B Piece bonds with a carrying value of $33.1 million.

(5)The commitment amount under this repurchase facility expires six months after the lender provides written notice. We then have an additional six months to repurchase the underlying loans.

20

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(6)These credit facilities, with a total committed amount of $514.5 million, mature on October 30, 2023 and we are currently in negotiations with these lenders to amend these facilities and extend the maturity.

During 2023, all of our remaining LIBOR-based financings were converted to a SOFR-based interest rate.

Structured Business

At September 30, 2023 and December 31, 2022, the weighted average interest rate for the credit and repurchase facilities of our Structured Business, including certain fees and costs, such as structuring, commitment, non-use and warehousing fees, was 8.14% and 6.95%, respectively. The leverage on our loan and investment portfolio financed through our credit and repurchase facilities, excluding the securities repurchase facility and the working capital facility, was 69% and 73% at September 30, 2023 and December 31, 2022, respectively.

In August 2023, we amended a $1.00 billion repurchase facility to extend the maturity to August 2025, with a one-year extension option, and amend the interest rate on new loans to SOFR plus 2.50%. The pricing on existing loans will remain unchanged until December 2023, at which time they will increase to SOFR plus 2.25%, as long as the weighted average spread of all loans is at least 2.40%. The pricing on existing loans will then increase to 2.50% in June 2024.

In July 2023, we amended our $3.00 billion joint repurchase facility, which is shared between our Structured Business and Agency Business. The facility size will remain at $3.00 billion until March 2024, at which time it will be reduced to $2.00 billion. In addition, the maturity was extended to July 2025, with a one-year extension option at the buyers discretion.

In July 2023, we amended a $400.0 million credit facility to decrease the facility size to $250.0 million, extend the maturity to July 2024 and amend the interest rates on new loans to SOFR plus 2.50% for multifamily loans, and SOFR plus 2.95% to 3.20% for non-multifamily loans.

In April 2023, we amended a $25.0 million credit facility to increase the facility size to $40.0 million and extend the maturity to April 2026.

In March 2023, we amended a $450.0 million repurchase facility to exercise a one-year extension option to March 2024 and amend the interest rate to a minimum of SOFR plus 2.00%.

Agency Business

In March 2023, we amended a $200.0 million credit facility to extend the maturity to March 2024 and amend the interest rate to SOFR plus 1.40%.

Securitized Debt

We account for securitized debt transactions on our consolidated balance sheet as financing facilities. These transactions are considered VIEs for which we are the primary beneficiary and are consolidated in our financial statements. The investment grade notes and guaranteed certificates issued to third parties are treated as secured financings and are non-recourse to us.

21

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Borrowings and the corresponding collateral under our securitized debt transactions are as follows ($ in thousands):

	Debt						Collateral (3)
							Loans				Cash
September 30, 2023	Face Value		Carrying Value (1)		Wtd. Avg. Rate (2)		UPB		Carrying Value		Restricted Cash (4)
CLO 19	$	872,812	$	867,904	7.77	%	$	1,014,554	$	1,010,753	$	4,527
CLO 18	1,652,812		1,647,326		7.22	%	1,908,793		1,903,837		20,983
CLO 17	1,714,125		1,709,255		7.10	%	1,901,897		1,896,347		149,206
CLO 16	1,237,500		1,233,286		6.73	%	1,343,886		1,340,303		91,434
CLO 15	674,412		672,897		6.78	%	770,602		768,436		19,714
CLO 14 (5)	655,475		653,876		6.74	%	756,030		754,189		13,920
Total CLOs	6,807,136		6,784,544		7.08	%	7,695,762		7,673,865		299,784
Q Series securitization	222,066		220,090		7.31	%	296,088		294,876		—
Total securitized debt	$	7,029,202	$	7,004,634	7.09	%	$	7,991,850	$	7,968,741	$	299,784
December 31, 2022
CLO 19	$	872,812	$	866,605	6.75	%	$	952,268	$	947,336	$	64,300
CLO 18	1,652,812		1,645,711		6.19	%	1,899,174		1,891,215		85,970
CLO 17	1,714,125		1,707,676		6.16	%	1,911,866		1,904,732		145,726
CLO 16	1,237,500		1,231,887		5.79	%	1,307,244		1,301,794		106,495
CLO 15	674,412		671,532		5.84	%	797,755		795,078		2,861
CLO 14	655,475		652,617		5.80	%	732,247		730,057		37,090
CLO 13	462,769		461,005		6.03	%	552,182		550,924		37,875
CLO 12	379,283		378,331		6.09	%	466,474		465,003		500
Total CLOs	7,649,188		7,615,364		6.10	%	8,619,210		8,586,139		480,817
Q Series securitization	236,878		233,906		6.30	%	315,837		313,965		—
Total securitized debt	$	7,886,066	$	7,849,270	6.11	%	$	8,935,047	$	8,900,104	$	480,817

________________________

(1)Debt carrying value is net of $24.6 million and $36.8 million of deferred financing fees at September 30, 2023 and December 31, 2022, respectively.

(2)At September 30, 2023 and December 31, 2022, the aggregate weighted average note rate for our securitized debt, including certain fees and costs, was 7.34% and 6.32%, respectively.

(3)At September 30, 2023, four loans with an aggregate UPB of $89.8 million were deemed a "credit risk" as defined by the collateralized loan obligations ("CLO") indentures. At December 31, 2022, there was no collateral deemed a “credit risk” as defined by the CLO indentures. A credit risk asset is generally defined as one that, in the CLO collateral manager's reasonable business judgment, has a significant risk of becoming a defaulted asset.

(4)Represents restricted cash held for principal repayments as well as for reinvestment in the CLOs. Excludes restricted cash related to interest payments, delayed fundings and expenses totaling $108.5 million and $230.0 million at September 30, 2023 and December 31, 2022, respectively.

(5)The replenishment period of CLO 14 ended in September 2023.

CLO 13 and 12. In June 2023 and August 2023, we unwound CLO 13 and 12, respectively, redeeming the remaining outstanding notes, which were repaid primarily from the refinancing of the remaining assets within our other CLO vehicles and credit and repurchase facilities. We expensed $1.2 million and $0.3 million of deferred financing fees in the second and third quarter of 2023, respectively, into loss on extinguishment of debt on the consolidated statements of income.

In the first quarter of 2022, we unwound a CLO and expensed $1.4 million of deferred financing fees into loss on extinguishment of debt on the consolidated statements of income.

22

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Senior Unsecured Notes

A summary of our senior unsecured notes is as follows ($ in thousands):

Senior Unsecured Notes	Issuance Date		September 30, 2023						December 31, 2022
		Maturity	UPB		Carrying Value (1)		Wtd. Avg. Rate (2)		UPB		Carrying Value (1)		Wtd. Avg. Rate (2)
7.75% Notes (3)	Mar. 2023	Mar. 2026	$	95,000	$	93,552	7.75	%	$	—	$	—	—
8.50% Notes (3)	Oct. 2022	Oct. 2027	150,000		147,904		8.50	%	150,000		147,519		8.50	%
5.00% Notes (3)	Dec. 2021	Dec. 2028	180,000		177,769		5.00	%	180,000		177,450		5.00	%
4.50% Notes (3)	Aug. 2021	Sept. 2026	270,000		267,555		4.50	%	270,000		266,926		4.50	%
5.00% Notes (3)	Apr. 2021	Apr. 2026	175,000		173,386		5.00	%	175,000		172,917		5.00	%
4.50% Notes (3)	Mar. 2020	Mar. 2027	275,000		273,322		4.50	%	275,000		272,960		4.50	%
4.75% Notes (4)	Oct. 2019	Oct. 2024	110,000		109,633		4.75	%	110,000		109,369		4.75	%
5.75% Notes (4)	Mar. 2019	Apr. 2024	90,000		89,805		5.75	%	90,000		89,514		5.75	%
8.00% Notes (3)	Apr. 2020	Apr. 2023	—		—		—		70,750		70,613		8.00	%
5.625% Notes (4)	Mar. 2018	May 2023	—		—		—		78,850		78,726		5.63	%
			$	1,345,000	$	1,332,926	5.41	%	$	1,399,600	$	1,385,994	5.40	%

________________________

(1)At September 30, 2023 and December 31, 2022, the carrying value is net of deferred financing fees of $12.1 million and $13.6 million, respectively.

(2)At September 30, 2023 and December 31, 2022, the aggregate weighted average note rate, including certain fees and costs, was 5.70% and 5.69%, respectively.

(3)These notes can be redeemed by us prior to three months before the maturity date, at a redemption price equal to 100% of the aggregate principal amount, plus a “make-whole” premium and accrued and unpaid interest. We have the right to redeem the notes within three months prior to the maturity date at a redemption price equal to 100% of the aggregate principal amount, plus accrued and unpaid interest.

(4)These notes can be redeemed by us at any time prior to the maturity date, at a redemption price equal to 100% of the aggregate principal amount, plus a “make-whole” premium and accrued and unpaid interest. We have the right to redeem the notes on the maturity date at a redemption price equal to 100% of the aggregate principal amount, plus accrued and unpaid interest.

In March 2023, we issued $95.0 million aggregate principal amount of 7.75% senior unsecured notes due in 2026 in a private offering. We received net proceeds of $93.4 million from the issuance, after deducting the placement agent commission and other offering expenses. We used $70.8 million of the proceeds, which included accrued interest and other fees, to repurchase the remaining portion of our 8.00% senior unsecured notes due in 2023.

In May 2023, our 5.625% senior unsecured notes matured and were redeemed for cash.

Convertible Senior Unsecured Notes

Our convertible senior unsecured notes are not redeemable by us prior to maturity (August 2025) and are convertible by the holder into, at our election, cash, shares of our common stock, or a combination of both, subject to the satisfaction of certain conditions and during specified periods. The conversion rates are subject to adjustment upon the occurrence of certain specified events and the holders may require us to repurchase all, or any portion, of their notes for cash equal to 100% of the principal amount, plus accrued and unpaid interest, if we undergo a fundamental change specified in the agreements.

The UPB and net carrying value of our convertible notes are as follows (in thousands):

Period	UPB		Unamortized Deferred Financing Fees		Net Carrying Value
September 30, 2023	$	287,500	$	5,072	$	282,428
December 31, 2022	$	287,500	$	7,144	$	280,356

23

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

During the three months ended September 30, 2023, we incurred interest expense on the notes totaling $6.1 million, of which $5.4 million and $0.7 million related to the cash coupon and deferred financing fees, respectively. During the nine months ended September 30, 2023, we incurred interest expense on the notes totaling $18.2 million, of which $16.1 million and $2.1 million related to the cash coupon and deferred financing fees, respectively. During the three months ended September 30, 2022, we incurred interest expense on the notes totaling $5.8 million, of which $5.0 million and $0.8 million related to the cash coupon and deferred financing fees, respectively. During the nine months ended September 30, 2022, we incurred interest expense on the notes totaling $13.4 million, of which $11.3 million and $2.1 million related to the cash coupon and deferred financing fees, respectively. Including the amortization of the deferred financing fees, our weighted average total cost of the notes was 8.42% at both September 30, 2023 and December 31, 2022. At September 30, 2023, the 7.50% convertible senior notes had a conversion rate of 60.2170 shares of common stock per $1,000 of principal, which represented a conversion price of $16.61 per share of common stock.

During the third quarter of 2022, our 4.75% convertible senior notes were repurchased and settled and we expensed $3.3 million of deferred financing fees into loss on extinguishment of debt.

Junior Subordinated Notes

The carrying values of borrowings under our junior subordinated notes were $143.7 million and $143.1 million at September 30, 2023 and December 31, 2022, respectively, which is net of a deferred amount of $9.1 million and $9.6 million, respectively, (which is amortized into interest expense over the life of the notes) and deferred financing fees of $1.5 million and $1.6 million at September 30, 2023 and December 31, 2022, respectively. These notes have maturities ranging from March 2034 through April 2037 and pay interest quarterly at a floating rate. The weighted average note rate was 8.55% and 7.65% at September 30, 2023 and December 31, 2022, respectively. Including certain fees and costs, the weighted average note rate was 8.63% and 7.74% at September 30, 2023 and December 31, 2022, respectively.

Debt Covenants

Credit and Repurchase Facilities and Unsecured Debt. The credit and repurchase facilities and unsecured debt (senior and convertible notes) contain various financial covenants, including, but not limited to, minimum liquidity requirements, minimum net worth requirements, minimum unencumbered asset requirements, as well as certain other debt service coverage ratios, debt to equity ratios and minimum servicing portfolio tests. We were in compliance with all financial covenants and restrictions at September 30, 2023.

CLOs. Our CLO vehicles contain interest coverage and asset overcollateralization covenants that must be met as of the waterfall distribution date in order for us to receive such payments. If we fail these covenants in any of our CLOs, all cash flows from the applicable CLO would be diverted to repay principal and interest on the outstanding CLO bonds and we would not receive any residual payments until that CLO regained compliance with such tests. Our CLOs were in compliance with all such covenants at September 30, 2023, as well as on the most recent determination dates in October 2023. In the event of a breach of the CLO covenants that could not be cured in the near-term, we would be required to fund our non-CLO expenses, including employee costs, distributions required to maintain our REIT status, debt costs, and other expenses with (1) cash on hand, (2) income from any CLO not in breach of a covenant test, (3) income from real property and loan assets, (4) sale of assets, or (5) accessing the equity or debt capital markets, if available. We have the right to cure covenant breaches which would resume normal residual payments to us by purchasing non-performing loans out of the CLOs. However, we may not have sufficient liquidity available to do so at such time.

24

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Our CLO compliance tests as of the most recent determination dates in October 2023 are as follows:

Cash Flow Triggers	CLO 14		CLO 15		CLO 16		CLO 17		CLO 18		CLO 19
Overcollateralization (1)
Current	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%
Limit	118.76	%	119.85	%	120.21	%	121.51	%	123.03	%	119.30	%
Pass / Fail	Pass		Pass		Pass		Pass		Pass		Pass
Interest Coverage (2)
Current	153.74	%	151.78	%	148.88	%	143.35	%	148.56	%	132.54	%
Limit	120.00	%	120.00	%	120.00	%	120.00	%	120.00	%	120.00	%
Pass / Fail	Pass		Pass		Pass		Pass		Pass		Pass

________________________

(1)The overcollateralization ratio divides the total principal balance of all collateral in the CLO by the total principal balance of the bonds associated with the applicable ratio. To the extent an asset is considered a defaulted security, the asset’s principal balance for purposes of the overcollateralization test is the lesser of the asset’s market value or the principal balance of the defaulted asset multiplied by the asset’s recovery rate which is determined by the rating agencies. Rating downgrades of CLO collateral will generally not have a direct impact on the principal balance of a CLO asset for purposes of calculating the CLO overcollateralization test unless the rating downgrade is below a significantly low threshold (e.g. CCC-) as defined in each CLO vehicle.

(2)The interest coverage ratio divides interest income by interest expense for the classes senior to those retained by us.

Our CLO overcollateralization ratios as of the determination dates subsequent to each quarter are as follows:

Determination (1)	CLO 14		CLO 15		CLO 16		CLO 17		CLO 18		CLO 19
October 2023	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%
July 2023	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%
April 2023	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%
January 2023	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%
October 2022	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%

________________________

(1)This table represents the quarterly trend of our overcollateralization ratio, however, the CLO determination dates are monthly and we were in compliance with this test for all periods presented.

The ratio will fluctuate based on the performance of the underlying assets, transfers of assets into the CLOs prior to the expiration of their respective replenishment dates, purchase or disposal of other investments, and loan payoffs. No payment due under the junior subordinated indentures may be paid if there is a default under any senior debt and the senior lender has sent notice to the trustee. The junior subordinated indentures are also cross-defaulted with each other.

Note 10 — Allowance for Loss-Sharing Obligations

Our allowance for loss-sharing obligations related to the Fannie Mae DUS program is as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Beginning balance	$	66,681	$	53,053	$	57,168	$	56,064
Provisions for loss sharing	1,703		2,346		13,992		2,593
Provisions reversal for loan repayments	(24)		(1,934)		(1,464)		(4,792)
Recoveries (charge-offs), net	901		46		(435)		(354)
Ending balance	$	69,261	$	53,511	$	69,261	$	53,511

25

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

When a loan is sold under the Fannie Mae DUS program, we undertake an obligation to partially guarantee the performance of the loan. A liability is recognized for the fair value of the guarantee obligation undertaken for the non-contingent aspect of the guarantee and is removed only upon either the expiration or settlement of the guarantee. At September 30, 2023 and 2022, we had $34.6 million and $34.2 million, respectively, of guarantee obligations included in the allowance for loss-sharing obligations.

In addition to and separately from the fair value of the guarantee, we estimate our allowance for loss-sharing under CECL over the contractual period in which we are exposed to credit risk. The current expected loss related to loss-sharing was based on a collective pooling basis with similar risk characteristics, a reasonable and supportable forecast and a reversion period based on our average historical losses through the remaining contractual term of the portfolio.

When we settle a loss under the DUS loss-sharing model, the net loss is charged-off against the previously recorded loss-sharing obligation. The settled loss is often net of any previously advanced principal and interest payments in accordance with the DUS program, which are reflected as reductions to the proceeds needed to settle losses. At September 30, 2023 and December 31, 2022, we had outstanding advances of $0.3 million and $0.8 million, respectively, which were netted against the allowance for loss-sharing obligations.

At September 30, 2023 and December 31, 2022, our allowance for loss-sharing obligations, associated with expected losses under CECL, was $34.7 million and $22.7 million, respectively, and represented 0.17% and 0.12%, respectively, of our Fannie Mae servicing portfolio. During the three and nine months ended September 30, 2023, we recorded a $2.5 million and $11.9 million, respectively, increase in CECL reserves.

At September 30, 2023 and December 31, 2022, the maximum quantifiable liability associated with our guarantees under the Fannie Mae DUS agreement was $3.79 billion and $3.49 billion, respectively. The maximum quantifiable liability is not representative of the actual loss we would incur. We would be liable for this amount only if all of the loans we service for Fannie Mae, for which we retain some risk of loss, were to default and all of the collateral underlying these loans was determined to be without value at the time of settlement.

Note 11 — Derivative Financial Instruments

We enter into derivative financial instruments to manage exposures that arise from business activities resulting in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates and credit risk. We do not use these derivatives for speculative purposes, but are instead using them to manage our interest rate and credit risk exposure.

Agency Rate Lock and Forward Sale Commitments. We enter into contractual commitments to originate and sell mortgage loans at fixed prices with fixed expiration dates. The commitments become effective when the borrower “rate locks” a specified interest rate within time frames established by us. All potential borrowers are evaluated for creditworthiness prior to the extension of the commitment. Market risk arises if interest rates move adversely between the time of the rate lock by the borrower and the sale date of the loan to an investor. To mitigate the effect of the interest rate risk inherent in providing rate lock commitments to borrowers under the GSE programs, we enter into a forward sale commitment with the investor simultaneously with the rate lock commitment with the borrower. The forward sale contract locks in an interest rate and price for the sale of the loan. The terms of the contract with the investor and the rate lock with the borrower are matched in substantially all respects, with the objective of eliminating interest rate risk to the extent practical. Sale commitments with the investors have an expiration date that is longer than our related commitments to the borrower to allow, among other things, for closing of the loan and processing of paperwork to deliver the loan into the sale commitment.

These commitments meet the definition of a derivative and are recorded at fair value, including the effects of interest rate movements which are reflected as a component of gain (loss) on derivative instruments, net in the consolidated statements of income. The estimated fair value of rate lock commitments also includes the fair value of the expected net cash flows associated with the servicing of the loan which is recorded as income from MSRs in the consolidated statements of income. During the three and nine months ended September 30, 2023, we recorded a net losses of $1.0 million and $2.0 million, respectively, from changes in the fair value of these derivatives and $14.1 million and $48.8 million, respectively, of income from MSRs. During the three and nine months ended September 30, 2022, we recorded net losses of $22.9 million and $20.5 million, respectively, from changes in the fair value of these derivatives and $19.4 million and $52.3 million, respectively, of income from MSRs. See Note 12 for details.

Interest Rate and Credit Default Swaps (“Swaps”). We enter into over-the-counter swaps to hedge our interest rate and credit risk exposure inherent in (1) our held-for-sale Agency Business Private Label loans from the time the loans are rate locked until sale or securitization, and (2) our Agency Business SFR – fixed rate loans from the time the loans are originated until the time they can be financed with match term fixed rate securitized debt. Our interest rate swaps typically have a three-month maturity and are tied to the five-year and ten-year swap rates. Our credit default swaps typically have a five-year maturity, are tied to the credit spreads of the underlying bond issuers and we typically hold our position until we price our Private Label loan securitizations. The Swaps do not meet the criteria for hedge accounting, are cleared by a central clearing house and variation margin payments, made in cash, are treated as a legal settlement of the derivative itself as opposed to a pledge of collateral.

26

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

During the three months ended September 30, 2023, we recorded realized and unrealized gains of $0.4 million and $0.2 million, respectively, to our Agency Business related to our Swaps. During the nine months ended September 30, 2023, we recorded realized gains of $1.5 million and unrealized losses of $3.0 million to our Agency Business related to our Swaps. During the three months ended September 30, 2022, we recorded realized and unrealized gains of $3.6 million and $3.4 million, respectively, to our Agency Business related to our Swaps. During the nine months ended September 30, 2022, we recorded realized and unrealized gains of $27.2 million and $3.4 million, respectively, to our Agency Business related to our Swaps. The realized and unrealized gains and losses are recorded in gain (loss) on derivative instruments, net.

A summary of our non-qualifying derivative financial instruments in our Agency Business is as follows ($ in thousands):

	September 30, 2023
					Fair Value
Derivative	Count	Notional Value		Balance Sheet Location	Derivative Assets		Derivative Liabilities
Rate lock commitments	4	$	107,093	Other assets/other liabilities	$	962	$	(2,339)
Forward sale commitments	36	455,363		Other assets/other liabilities	2,379		(5,822)
Swaps	82	8,200			—		—
		$	570,656		$	3,341	$	(8,161)
	December 31, 2022
Rate lock commitments	6	$	91,472	Other assets/other liabilities	$	354	$	(1,070)
Forward sale commitments	27	294,451		Other assets/other liabilities	1,151		(3,827)
Swaps	1,298	129,800			—		—
		$	515,723		$	1,505	$	(4,897)

Note 12 — Fair Value

Fair value estimates are dependent upon subjective assumptions and involve significant uncertainties resulting in variability in estimates with changes in assumptions. The following table summarizes the principal amounts, carrying values and the estimated fair values of our financial instruments (in thousands):

	September 30, 2023						December 31, 2022
	Principal / Notional Amount		Carrying Value		Estimated Fair Value		Principal / Notional Amount		Carrying Value		Estimated Fair Value
Financial assets:
Loans and investments, net	$	13,122,395	$	12,892,796	$	12,911,172	$	14,456,123	$	14,254,674	$	14,468,418
Loans held-for-sale, net	368,330		364,320		374,534		368,066		354,070		362,054
Capitalized mortgage servicing rights, net	n/a		392,203		538,078		n/a		401,471		530,913
Securities held-to-maturity, net	231,577		155,172		126,608		234,255		156,547		144,571
Derivative financial instruments	130,778		3,341		3,341		111,950		1,505		1,505
Financial liabilities:
Credit and repurchase facilities	$	3,398,451	$	3,391,441	$	3,382,933	$	3,856,009	$	3,841,814	$	3,828,192
Securitized debt	7,029,202		7,004,634		6,899,147		7,886,066		7,849,270		7,560,541
Senior unsecured notes	1,345,000		1,332,926		1,211,633		1,399,600		1,385,994		1,262,560
Convertible senior unsecured notes	287,500		282,428		290,019		287,500		280,356		287,834
Junior subordinated notes	154,336		143,695		105,821		154,336		143,128		103,977
Derivative financial instruments	431,678		8,161		8,161		273,973		4,897		4,897

Assets and liabilities disclosed at fair value are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Determining which category an asset or liability falls within the hierarchy requires judgment and we evaluate our

27

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

hierarchy disclosures each quarter. Hierarchical levels directly related to the amount of subjectivity associated with the inputs to fair valuation of these assets and liabilities are as follows:

Level 1—Inputs are unadjusted and quoted prices exist in active markets for identical assets or liabilities, such as government, agency and equity securities.

Level 2—Inputs (other than quoted prices included in Level 1) are observable for the asset or liability through correlation with market data. Level 2 inputs may include quoted market prices for a similar asset or liability, interest rates and credit risk. Examples include non-government securities, certain mortgage and asset-backed securities, certain corporate debt and certain derivative instruments.

Level 3—Inputs reflect our best estimate of what market participants would use in pricing the asset or liability and are based on significant unobservable inputs that require a considerable amount of judgment and assumptions. Examples include certain mortgage and asset-backed securities, certain corporate debt and certain derivative instruments.

The following is a description of the valuation techniques used to measure fair value and the general classification of these instruments pursuant to the fair value hierarchy.

Loans and investments, net. Fair values of loans and investments that are not impaired are estimated using inputs based on direct capitalization rate and discounted cash flow methodologies using discount rates, which, in our opinion, best reflect current market interest rates that would be offered for loans with similar characteristics and credit quality (Level 3). Fair values of impaired loans and investments are estimated using inputs that require significant judgments, which include assumptions regarding discount rates, capitalization rates, creditworthiness of major tenants, occupancy rates, availability of financing, exit plans and other factors (Level 3).

Loans held-for-sale, net. Consists of originated loans that are generally expected to be transferred or sold within 60 days to 180 days of loan funding, and are valued using pricing models that incorporate observable inputs from current market assumptions or a hypothetical securitization model utilizing observable market data from recent securitization spreads and observable pricing of loans with similar characteristics (Level 2). Fair value includes the fair value allocated to the associated future MSRs and is calculated pursuant to the valuation techniques described below for capitalized mortgage servicing rights, net (Level 3).

Capitalized mortgage servicing rights, net. Fair values are estimated using inputs based on discounted future net cash flow methodology (Level 3). The fair value of MSRs is estimated using a process that involves the use of independent third-party valuation experts, supported by commercially available discounted cash flow models and analysis of current market data. The key inputs used in estimating fair value include the contractually specified servicing fees, prepayment speed of the underlying loans, discount rate, annual per loan cost to service loans, delinquency rates, late charges and other economic factors.

Securities held-to-maturity, net. Fair values are approximated using inputs based on current market quotes received from financial sources that trade such securities and are based on prevailing market data and, in some cases, are derived from third-party proprietary models based on well recognized financial principles and reasonable estimates about relevant future market conditions (Level 3).

Derivative financial instruments. Fair values of rate lock and forward sale commitments are estimated using valuation techniques, which include internally-developed models developed based on changes in the U.S. Treasury rate and other observable market data (Level 2). The fair value of rate lock commitments includes the fair value of the expected net cash flows associated with the servicing of the loans, see capitalized mortgage servicing rights, net above for details on the applicable valuation technique (Level 3). We also consider the impact of counterparty non-performance risk when measuring the fair value of these derivatives. Given the credit quality of our counterparties, the short duration of interest rate lock commitments and forward sale contracts, and our historical experience, the risk of nonperformance by our counterparties is not significant.

Credit and repurchase facilities. Fair values for credit and repurchase facilities of the Structured Business are estimated using discounted cash flow methodology, using discount rates, which, in our opinion, best reflect current market interest rates for financing with similar characteristics and credit quality (Level 3). The majority of our credit and repurchase facilities for the Agency Business bear interest at rates that are similar to those available in the market currently and fair values are estimated using Level 2 inputs. For these facilities, the fair values approximate their carrying values.

Securitized debt and junior subordinated notes. Fair values are estimated based on broker quotations, representing the discounted expected future cash flows at a yield that reflects current market interest rates and credit spreads (Level 3).

Senior unsecured notes. Fair values are estimated at current market quotes received from active markets when available (Level 1). If quotes from active markets are unavailable, then the fair values are estimated utilizing current market quotes received from inactive markets (Level 2).

28

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Convertible senior unsecured notes. Fair values are estimated using current market quotes received from inactive markets (Level 2).

We measure certain financial assets and financial liabilities at fair value on a recurring basis. The fair values of these financial assets and liabilities are determined using the following input levels at September 30, 2023 (in thousands):

	Carrying Value		Fair Value		Fair Value Measurements Using Fair Value Hierarchy
					Level 1		Level 2		Level 3
Financial assets:
Derivative financial instruments	$	3,341	$	3,341	$	—	$	2,379	$	962
Financial liabilities:
Derivative financial instruments	$	8,161	$	8,161	$	—	$	8,161	$	—

We measure certain financial and non-financial assets at fair value on a nonrecurring basis. The fair values of these financial and non-financial assets, if applicable, are determined using the following input levels at September 30, 2023 (in thousands):

	Net Carrying Value		Fair Value		Fair Value Measurements Using Fair Value Hierarchy
					Level 1		Level 2		Level 3
Financial assets:
Impaired loans, net
Loans held-for-investment (1)	$	169,171	$	169,171	$	—	$	—	$	169,171
Loans held-for-sale (2)	17,169		17,169		—		17,169		—
	$	186,340	$	186,340	$	—	$	17,169	$	169,171

________________________

(1)We had an allowance for credit losses of $111.1 million relating to thirteen impaired loans with an aggregate carrying value, before loan loss reserves, of $280.3 million at September 30, 2023.

(2)We had unrealized impairment losses of $2.9 million related to six held-for-sale loans with an aggregate carrying value, before unrealized impairment losses, of $20.1 million.

Loan impairment assessments. Loans held-for-investment are intended to be held to maturity and, accordingly, are carried at cost, net of unamortized loan origination costs and fees, loan purchase discounts, and net of the allowance for credit losses, when such loan or investment is deemed to be impaired. We consider a loan impaired when, based upon current information, it is probable that all amounts due for both principal and interest will not be collected according to the contractual terms of the loan agreement. We evaluate our loans to determine if the value of the underlying collateral securing the impaired loan is less than the net carrying value of the loan, which may result in an allowance, and corresponding charge to the provision for credit losses, or an impairment loss. These valuations require significant judgments, which include assumptions regarding capitalization and discount rates, revenue growth rates, creditworthiness of major tenants, occupancy rates, availability of financing, exit plan and other factors.

Loans held-for-sale are generally transferred and sold within 60-180 days of loan origination and are reported at lower of cost or market. We consider a loan classified as held-for-sale impaired if, based on current information, it is probable that we will sell the loan below par, or not be able to collect all principal and interest in accordance with the contractual terms of the loan agreement. These loans are valued using pricing models that incorporate observable inputs from current market assumptions or a hypothetical securitization model utilizing observable market data from recent securitization spreads and observable pricing of loans with similar characteristics.

The tables above and below include all impaired loans, regardless of the period in which the impairment was recognized.

29

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Quantitative information about Level 3 fair value measurements at September 30, 2023 is as follows ($ in thousands):

	Fair Value		Valuation Techniques	Significant Unobservable Inputs
Financial assets:
Impaired loans:
Multifamily	$	70,246	Discounted cash flows	Capitalization rate	6.53	%
Land	50,000		Discounted cash flows	Discount rate	21.50	%
				Revenue growth rate	3.00	%
				Discount rate	7.50	%
Office	37,074		Discounted cash flows	Capitalization rate	5.25	%
				Revenue growth rate	3.00	%
				Discount rate	11.25	%
Retail	11,851		Discounted cash flows	Capitalization rate	9.25	%
				Revenue growth rate	3.00	%
Derivative financial instruments:
Rate lock commitments	962		Discounted cash flows	W/A discount rate	12.27	%

The derivative financial instruments using Level 3 inputs are outstanding for short periods of time (generally less than 60 days). A roll-forward of Level 3 derivative instruments is as follows (in thousands):

	Fair Value Measurements Using Significant Unobservable Inputs
	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Derivative assets and liabilities, net
Beginning balance	$	757	$	1,035	$	354	$	295
Settlements	(13,369)		(16,554)		(46,123)		(47,491)
Realized gains recorded in earnings	12,612		15,519		45,769		47,196
Unrealized gains recorded in earnings	962		1,554		962		1,554
Ending balance	$	962	$	1,554	$	962	$	1,554

The components of fair value and other relevant information associated with our rate lock commitments, forward sales commitments and the estimated fair value of cash flows from servicing on loans held-for-sale are as follows (in thousands):

September 30, 2023	Notional/ Principal Amount		Fair Value of Servicing Rights		Interest Rate Movement Effect		Unrealized Impairment Loss		Total Fair Value Adjustment
Rate lock commitments	$	107,093	$	962	$	(2,339)	$	—	$	(1,377)
Forward sale commitments	455,363		—		2,339		—		2,339
Loans held-for-sale, net (1)	368,330		4,302		—		(2,891)		1,411
Total			$	5,264	$	—	$	(2,891)	$	2,373

________________________

(1)Loans held-for-sale, net are recorded at the lower of cost or market on an aggregate basis and includes fair value adjustments related to estimated cash flows from MSRs.

30

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

We measure certain assets and liabilities for which fair value is only disclosed. The fair value of these assets and liabilities are determined using the following input levels at September 30, 2023 (in thousands):

					Fair Value Measurements Using Fair Value Hierarchy
	Carrying Value		Fair Value		Level 1		Level 2		Level 3
Financial assets:
Loans and investments, net	$	12,892,796	$	12,911,172	$	—	$	—	$	12,911,172
Loans held-for-sale, net	364,320		374,534		—		370,232		4,302
Capitalized mortgage servicing rights, net	392,203		538,078		—		—		538,078
Securities held-to-maturity, net	155,172		126,608		—		—		126,608
Financial liabilities:
Credit and repurchase facilities	$	3,391,441	$	3,382,933	$	—	$	354,586	$	3,028,347
Securitized debt	7,004,634		6,899,147		—		—		6,899,147
Senior unsecured notes	1,332,926		1,211,633		1,211,633		—		—
Convertible senior unsecured notes	282,428		290,019		—		290,019		—
Junior subordinated notes	143,695		105,821		—		—		105,821

Note 13 — Commitments and Contingencies

Agency Business Commitments. Our Agency Business is subject to supervision by certain regulatory agencies. Among other things, these agencies require us to meet certain minimum net worth, operational liquidity and restricted liquidity collateral requirements, and compliance with reporting requirements. Our adjusted net worth and liquidity required by the agencies for all periods presented exceeded these requirements.

At September 30, 2023, we were required to maintain at least $19.8 million of liquid assets in one of our subsidiaries to meet our operational liquidity requirements for Fannie Mae and we had operational liquidity in excess of this requirement.

We are generally required to share the risk of any losses associated with loans sold under the Fannie Mae DUS program and are required to secure this obligation by assigning restricted cash balances and/or a letter of credit to Fannie Mae. The amount of collateral required by Fannie Mae is a formulaic calculation at the loan level by a Fannie Mae assigned tier, which considers the loan balance, risk level of the loan, age of the loan and level of risk-sharing. Fannie Mae requires restricted liquidity for Tier 2 loans of 75 basis points, 15 basis points for Tier 3 loans and 5 basis points for Tier 4 loans, which is funded over a 48-month period that begins upon delivery of the loan to Fannie Mae. A significant portion of our Fannie Mae DUS serviced loans for which we have risk sharing are Tier 2 loans. At September 30, 2023, the restricted liquidity requirement totaled $72.6 million and was satisfied with a $64.0 million letter of credit and cash issued to Fannie Mae.

At September 30, 2023, reserve requirements for the Fannie Mae DUS loan portfolio will require us to fund $37.3 million in additional restricted liquidity over the next 48 months, assuming no further principal paydowns, prepayments, or defaults within our at-risk portfolio. Fannie Mae periodically reassesses these collateral requirements and may make changes to these requirements in the future. We generate sufficient cash flow from our operations to meet these capital standards and do not expect any changes to have a material impact on our future operations; however, future changes to collateral requirements may adversely impact our available cash.

We are subject to various capital requirements in connection with seller/servicer agreements that we have entered into with secondary market investors. Failure to maintain minimum capital requirements could result in our inability to originate and service loans for the respective investor and, therefore, could have a direct material effect on our consolidated financial statements. At September 30, 2023, we met all of Fannie Mae’s quarterly capital requirements and our Fannie Mae adjusted net worth was in excess of the required net worth. We are not subject to capital requirements on a quarterly basis for Ginnie Mae and FHA, as requirements for these investors are only required on an annual basis.

As an approved designated seller/servicer under Freddie Mac’s SBL program, we are required to post collateral to ensure that we are able to meet certain purchase and loss obligations required by this program. Under the SBL program, we are required to post collateral equal to $5.0 million, which is satisfied with a $5.0 million letter of credit.

31

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

We enter into contractual commitments with borrowers providing rate lock commitments while simultaneously entering into forward sale commitments with investors. These commitments are outstanding for short periods of time (generally less than 60 days) and are described in more detail in Note 11 and Note 12.

Debt Obligations and Operating Leases. At September 30, 2023, the maturities of our debt obligations and the minimum annual operating lease payments under leases with a term in excess of one year are as follows (in thousands):

Year	Debt Obligations		Minimum Annual Operating Lease Payments		Total
2023 (three months ending December 31, 2023)	$	858,768	$	2,300	$	861,068
2024	2,004,350		10,188		2,014,538
2025	3,378,563		10,555		3,389,118
2026	4,523,241		10,627		4,533,868
2027	1,115,231		9,225		1,124,456
2028	180,000		8,624		188,624
Thereafter	154,336		27,755		182,091
Total	$	12,214,489	$	79,274	$	12,293,763

During the three and nine months ended September 30, 2023 and the three and nine months ended September 30, 2022, we recorded lease expense of $2.8 million, $8.0 million, $2.4 million and $7.2 million, respectively.

Unfunded Commitments. In accordance with certain structured loans and investments, we have outstanding unfunded commitments of $1.08 billion at September 30, 2023 that we are obligated to fund as borrowers meet certain requirements. Specific requirements include, but are not limited to, property renovations, building construction and conversions based on criteria met by the borrower in accordance with the loan agreements.

Litigation. We are subject to a variety of claims and suits that arise from time to time in the ordinary course of our business. Although management currently believes that resolving claims against us, individually or in aggregate, will not have a material adverse impact in our consolidated financial statements, these matters are subject to inherent uncertainties and management’s view of these matters may change in the future. Other than the litigation noted below, we are currently neither subject to any material litigation nor, to the best of our knowledge, threatened by any material litigation.

In June 2011, three related lawsuits were filed by the Extended Stay Litigation Trust (the “Trust”), a post-bankruptcy litigation trust alleged to have standing to pursue claims that previously had been held by Extended Stay, Inc. and the Homestead Village L.L.C. family of companies that had emerged from bankruptcy. There were 73 defendants in the three lawsuits, including 55 corporate and partnership entities and 18 individuals. A subsidiary of ours and certain individuals and other entities that are affiliates of ours were included as defendants.

In June 2013, the Trust amended the lawsuits, to, among other things, (1) consolidate the lawsuits into one lawsuit, (2) remove 47 defendants from the lawsuits, none of whom were related to us, so that there were 26 remaining defendants, including 16 corporate and partnership entities and 10 individuals, and (3) reduce the counts within the lawsuits from over 100 down to 17 (as consolidated, the "Action"). For more detailed information regarding the Action, please refer to Note 14 of our 2022 Annual Report.

After extensive motion practice and discovery, in early December 2022, the plaintiff and certain co-defendants, including our affiliates, commenced discussions regarding a possible settlement of the Action, and in late December 2022, those parties reached an agreement in principle to settle the Action for a total of $38.0 million. We agreed to pay up to $7.4 million of the settlement amount, which amount was accrued in our December 31, 2022 financial statements.

In early March 2023, the parties to the settlement finalized the settlement documents and on April 25, 2023, the Bankruptcy Court approved the settlement in open court. Following the Bankruptcy Court approval, the parties made the agreed upon payments, the broad mutual releases became effective and on June 23, 2023, the litigation was discontinued, with prejudice.

Due to Borrowers. Due to borrowers represents borrowers’ funds held by us to fund certain expenditures or to be released at our discretion upon the occurrence of certain pre-specified events, and to serve as additional collateral for borrowers’ loans. While retained, these balances earn interest in accordance with the specific loan terms they are associated with.

32

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Note 14 — Variable Interest Entities

Our involvement with VIEs primarily affects our financial performance and cash flows through amounts recorded in interest income, interest expense, provision for loan losses and through activity associated with our derivative instruments.

Consolidated VIEs. We have determined that our operating partnership, ARLP, and our CLO and Q Series securitization entities (“Securitization Entities”) are VIEs, which we consolidate. ARLP was already consolidated in our financial statements, therefore, the identification of this entity as a VIE had no impact on our consolidated financial statements.

Our Securitization Entities invest in real estate and real estate-related securities and are financed by the issuance of debt securities. We believe we hold the power necessary to direct the most significant economic activities of those entities. We also have exposure to losses to the extent of our equity interests and rights to waterfall payments in excess of required payments to bond investors. As a result of consolidation, equity interests have been eliminated, and the consolidated balance sheets reflect both the assets held and debt issued to third parties by the Securitization Entities, prior to the unwind. Our operating results and cash flows include the gross asset and liability amounts related to the Securitization Entities as opposed to our net economic interests in those entities.

The assets and liabilities related to these consolidated Securitization Entities are as follows (in thousands):

	September 30, 2023		December 31, 2022
Assets:
Restricted cash	$	408,569	$	710,775
Loans and investments, net	7,968,741		8,900,104
Other assets	311,988		174,382
Total assets	$	8,689,298	$	9,785,261
Liabilities:
Securitized debt	$	7,004,634	$	7,849,270
Other liabilities	23,259		26,754
Total liabilities	$	7,027,893	$	7,876,024

Assets held by the Securitization Entities are restricted and can only be used to settle obligations of those entities. The liabilities of the Securitization Entities are non-recourse to us and can only be satisfied from each respective asset pool. See Note 9 for details. We are not obligated to provide, have not provided, and do not intend to provide financial support to any of the Securitization Entities.

Unconsolidated VIEs. We determined that we are not the primary beneficiary of 27 VIEs in which we have a variable interest at September 30, 2023 because we do not have the ability to direct the activities of the VIEs that most significantly impact each entity’s economic performance.

A summary of our variable interests in identified VIEs, of which we are not the primary beneficiary, at September 30, 2023 is as follows (in thousands):

Type	Carrying Amount (1)
Loans	$	433,532
APL certificates	129,887
B Piece bonds	31,228
Equity investments	17,771
Agency interest only strips	177
Total	$	612,595

________________________

(1)Represents the carrying amount of loans and investments before reserves. At September 30, 2023, $172.9 million of loans to VIEs had corresponding specific loan loss reserves of $85.8 million. The maximum loss exposure at September 30, 2023 would not exceed the carrying amount of our investment.

These unconsolidated VIEs have exposure to real estate debt of approximately $3.86 billion at September 30, 2023.

33

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Note 15 — Equity

Common Stock. During the nine months ended September 30, 2023, we sold 13,113,296 shares of our common stock at an average price of $14.77 per share for net proceeds of $193.6 million through an “At-The-Market” equity offering sales agreement. The proceeds were used to make investments related to our business and for general corporate purposes.

In March 2023, the Board of Directors authorized a share repurchase program providing for the repurchase of up to $50.0 million of our outstanding common stock. The repurchase of our common stock may be made from time to time in the open market, through privately negotiated transactions, or otherwise in compliance with Rule 10b-18 and Rule 10b5-1 under the Securities Exchange Act of 1934, based on our stock price, general market conditions, applicable legal requirements and other factors. The program may be discontinued or modified at any time. At September 30, 2023, we repurchased 3,545,604 shares of our common stock under this program at a total cost of $37.4 million and an average cost of $10.56 per share.

Noncontrolling Interest. Noncontrolling interest relates to the operating partnership units (“OP Units”) issued to satisfy a portion of the purchase price in connection with the acquisition of the agency platform of Arbor Commercial Mortgage, LLC (“ACM”) in 2016. Each of these OP Units are paired with one share of our special voting preferred shares having a par value of $0.01 per share and is entitled to one vote each on any matter submitted for stockholder approval. The OP Units are entitled to receive distributions if and when our Board of Directors authorizes and declares common stock distributions. The OP Units are also redeemable for cash, or at our option, for shares of our common stock on a one-for-one basis. At September 30, 2023, there were 16,293,589 OP Units outstanding, which represented 8.0% of the voting power of our outstanding stock.

Distributions. Dividends declared (on a per share basis) during the nine months ended September 30, 2023 are as follows:

Common Stock			Preferred Stock
				Dividend
Declaration Date	Dividend		Declaration Date	Series D		Series E		Series F
February 15, 2023	$	0.40	January 3, 2023	$	0.3984375	$	0.390625	$	0.390625
May 3, 2023	$	0.42	March 31, 2023	$	0.3984375	$	0.390625	$	0.390625
July 26, 2023	$	0.43	June 30, 2023	$	0.3984375	$	0.390625	$	0.390625
			September 29, 2023	$	0.3984375	$	0.390625	$	0.390625

Common Stock – On October 25, 2023, the Board of Directors declared a cash dividend of $0.43 per share of common stock. The dividend is payable on November 30, 2023 to common stockholders of record as of the close of business on November 17, 2023.

Deferred Compensation. During 2023, we issued 939,325 shares of restricted common stock to our employees and Board of Directors under the 2020 Amended Omnibus Stock Incentive Plan (the “2020 Plan”) with a total grant date fair value of $11.2 million, of which: (1) 297,182 shares with a grant date fair value of $3.6 million vested on the grant date in 2023; (2) 276,785 shares with a grant date fair value of $3.3 million will vest in 2024; (3) 252,510 shares with a grant date fair value of $3.0 million will vest in 2025; (4) 78,126 shares with a grant date fair value of $0.9 million will vest in 2026; and (5) 34,722 shares with a grant date fair value of $0.4 million will vest in 2027. We also issued 40,796 fully vested restricted stock units (“RSUs”) with a grant date fair value of $0.5 million to certain members of our Board of Directors and 247,275 RSUs with a grant date fair value of $2.9 million that vest in full in the first quarter of 2026 to our chief executive officer. The individuals decided to defer the receipt of the common stock, to which the RSUs are converted into, to a future date pursuant to a pre-established deferral election.

During the first and third quarters of 2023, 352,427 shares of performance-based restricted stock units and 313,152 shares of restricted common stock, respectively, previously granted to our chief executive officer fully vested and were net settled for 172,513 and 153,287 common shares, respectively.

During 2023, we withheld 220,315 shares from the net settlement of restricted common stock by employees for payment of withholding taxes on shares that vested.

Earnings Per Share (“EPS”). Basic EPS is calculated by dividing net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding during each period inclusive of unvested restricted stock with full dividend participation rights. Diluted EPS is calculated by dividing net income (loss) by the weighted average number of shares of common stock outstanding, plus the additional dilutive effect of common stock equivalents during each period. Our common stock equivalents include the weighted average dilutive effect of restricted stock units granted to our chief executive officer, OP Units and convertible senior unsecured notes.

34

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

A reconciliation of the numerator and denominator of our basic and diluted EPS computations is as follows ($ in thousands, except share and per share data):

	Three Months Ended September 30,
	2023				2022
	Basic		Diluted		Basic		Diluted
Net income attributable to common stockholders (1)	$	77,924	$	77,924	$	62,710	$	62,710
Net income attributable to noncontrolling interest (2)	—		6,789		—		6,002
Interest expense on convertible notes	—		6,081		—		5,797
Net income attributable to common stockholders and noncontrolling interest	$	77,924	$	90,794	$	62,710	$	74,509
Weighted average shares outstanding	187,023,395		187,023,395		170,227,553		170,227,553
Dilutive effect of OP Units (2)	—		16,293,589		—		16,293,589
Dilutive effect of convertible notes	—		17,312,382		—		18,815,399
Dilutive effect of restricted stock units (3)	—		699,452		—		528,475
Weighted average shares outstanding	187,023,395		221,328,818		170,227,553		205,865,016
Net income per common share (1)	$	0.42	$	0.41	$	0.37	$	0.36
	Nine Months Ended September 30,
	2023				2022
Net income attributable to common stockholders (1)	$	238,407	$	238,407	$	196,678	$	196,678
Net income attributable to noncontrolling interest (2)	—		21,200		—		19,811
Interest expense on convertible notes	—		18,244		—		13,786
Net income attributable to common stockholders and noncontrolling interest	$	238,407	$	277,851	$	196,678	$	230,275
Weighted average shares outstanding	183,340,149		183,340,149		162,292,235		162,292,235
Dilutive effect of OP Units (2)	—		16,293,589		—		16,308,361
Dilutive effect of convertible notes	—		17,271,419		—		16,370,528
Dilutive effect of restricted stock units (3)	—		552,242		—		558,216
Weighted average shares outstanding	183,340,149		217,457,399		162,292,235		195,529,340
Net income per common share (1)	$	1.30	$	1.28	$	1.21	$	1.18

________________________

(1)Net of preferred stock dividends.

(2)We consider OP Units to be common stock equivalents as the holders have voting rights, the right to distributions and the right to redeem the OP Units for the cash value of a corresponding number of shares of common stock or a corresponding number of shares of common stock, at our election.

(3)Our chief executive officer was granted restricted stock units, which vest at the end of a four-year performance period based upon our achievement of total stockholder return objectives.

Note 16 — Income Taxes

As a REIT, we are generally not subject to U.S. federal income tax to the extent of our distributions to stockholders and as long as certain asset, income, distribution, ownership and administrative tests are met. To maintain our qualification as a REIT, we must annually distribute at least 90% of our REIT-taxable income to our stockholders and meet certain other requirements. We may also be subject to certain state, local and franchise taxes. Under certain circumstances, federal income and excise taxes may be due on our undistributed taxable income. If we were to fail to meet these requirements, we would be subject to U.S. federal income tax, which could have a material adverse impact on our results of operations and amounts available for distributions to our stockholders. We believe that all of the criteria to maintain our REIT qualification have been met for the applicable periods, but there can be no assurance that these criteria will continue to be met in subsequent periods.

35

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

The Agency Business is operated through our TRS Consolidated Group and is subject to U.S. federal, state and local income taxes. In general, our TRS entities may hold assets that the REIT cannot hold directly and may engage in real estate or non-real estate-related business.

In the three and nine months ended September 30, 2023, we recorded a tax provision of $5.9 million and $19.4 million, respectively. In the three and nine months ended September 30, 2022, we recorded a tax benefit of $0.4 million and a tax provision of $13.2 million. The tax provision recorded in the three months ended September 30, 2023 consisted of a current tax provision of $8.3 million and a deferred tax benefit of $2.4 million. The tax provision recorded in the nine months ended September 30, 2023 consisted of a current tax provision of $26.0 million and a deferred tax benefit of $6.6 million. The tax benefit recorded in the three months ended September 30, 2022 consisted of a current tax provision of $5.0 million and a deferred tax benefit of $5.4 million. The tax provision recorded in the nine months ended September 30, 2022 consisted of a current tax provision of $21.0 million and a deferred tax benefit of $7.8 million. Current and deferred taxes are primarily recorded on the portion of earnings (losses) recognized by us with respect to our interest in the TRS’s. Deferred income tax assets and liabilities are calculated based on temporary differences between our U.S. GAAP consolidated financial statements and the federal, state, local tax basis of assets and liabilities as of the consolidated balance sheets.

Note 17 — Agreements and Transactions with Related Parties

Support Agreement and Employee Secondment Agreement. We have a support agreement and a secondment agreement with ACM and certain of its affiliates and certain affiliates of a relative of our chief executive officer (“Service Recipients”) where we provide support services and seconded employees to the Service Recipients. The Service Recipients reimburse us for the costs of performing such services and the cost of the seconded employees. During the three and nine months ended September 30, 2023, we incurred $0.9 million and $2.3 million, respectively, and, during the three and nine months ended September 30, 2022, we incurred $0.9 million and $2.5 million, respectively, of costs for services provided and employees seconded to the Service Recipients, which is included in due from related party on the consolidated balance sheets. These costs were reimbursed to us subsequent to period end.

Other Related Party Transactions. Due from related party was $211.7 million and $77.4 million at September 30, 2023 and December 31, 2022, respectively, which consisted primarily of amounts due from our affiliated servicing operations related to real estate transactions closing at the end of the quarter and amounts due from ACM for costs incurred in connection with the support and secondment agreements described above.

Due to related party was $2.2 million and $12.4 million at September 30, 2023 and December 31, 2022, respectively, and consisted of loan payoffs, holdbacks and escrows to be remitted to our affiliated servicing operations related to real estate transactions.

In certain instances, our business requires our executives to charter privately owned aircraft in furtherance of our business. We have an aircraft time-sharing agreement with an entity controlled by our chief executive officer that owns a private aircraft. Pursuant to the agreement, we reimburse the aircraft owner for the required costs under Federal Aviation Administration regulations for the flights our executives’ charter. During the nine months ended September 30, 2023 and 2022, we reimbursed the aircraft owner $0.6 million and $1.0 million, respectively, for the flights chartered by our executives pursuant the agreement.

In May 2023, we committed to fund a $56.9 million bridge loan ($3.8 million was funded at September 30, 2023) for an SFR build-to-rent construction project. Two of our officers have made minority equity investments totaling $0.5 million, representing approximately 4.0% of the total equity invested in the project. The loan has an interest rate of SOFR plus 5.50% with a SOFR floor of 3.25% and matures in December 2025, with two six-month extension options. Interest income recorded from this loan was $0.1 million and $0.2 million for the three and nine months ended September 30, 2023, respectively.

In July 2022, we purchased a $46.2 million bridge loan originated by ACM at par ($3.5 million was funded at September 30, 2023) for an SFR build-to-rent construction project. A consortium of investors (which includes, among other unaffiliated investors, certain of our officers with a minority ownership interest) owns 70% of the borrowing entity and an entity indirectly owned and controlled by an immediate family member of our chief executive officer owns 10% of the borrowing entity. The loan has an interest rate of SOFR plus 5.5% and matures in March 2025. Interest income recorded from this loan was $0.1 million for both the three and nine months ended September 30, 2023.

In April 2022, we committed to fund a $67.1 million bridge loan (none of which was funded at September 30, 2023) in an SFR build-to-rent construction project. An entity owned by an immediate family member of our chief executive officer also made an equity investment in the project and owns a 2.25% equity interest in the borrowing entity. The loan has an interest rate of SOFR plus 4.63% with a SOFR floor of 0.25% and matures in May 2025. Interest income recorded from this loan was $0.1 million and $0.2 million for the three and nine months ended September 30, 2023, respectively, and less than $0.1 million and $0.1 million for the three and nine months ended September 30, 2022, respectively.

36

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

In February 2022, we committed to fund a $39.4 million bridge loan ($3.1 million was funded at September 30, 2023) in an SFR build-to-rent construction project. An entity owned by an immediate family member of our chief executive officer also made an equity investment in the project and owns a 2.25% equity interest in the borrowing entity. The loan had an interest rate of LIBOR plus 4.0% with a LIBOR floor of 0.25% and matures in March 2025. On July 1, 2023, the interest rate was changed to SOFR plus 4.0% with a SOFR floor of 0.25%. Interest income recorded from this loan was less than $0.1 million for both the three months ended September 30, 2023 and 2022, and $0.1 million for both the nine months ended September 30, 2023 and 2022.

In 2021, we invested $4.2 million for 49.3% interest in a limited liability company (“LLC”) which purchased a retail property for $32.5 million and assumed an existing $26.0 million CMBS loan. A portion of the property can potentially be converted to office space, of which we have the right to occupy, in part. An entity owned by an immediate family member of our chief executive officer also made an investment in the LLC for a 10.0% ownership, is the managing member and holds the right to purchase our interest in the LLC.

In 2021, we originated a $63.4 million bridge loan to a third party to purchase a multifamily property from a multifamily-focused commercial real estate investment fund sponsored and managed by our chief executive officer and one of his immediate family members, which fund has no continued involvement with the property following the purchase. The loan had an interest rate of LIBOR plus 3.75% with a LIBOR floor of 0.25% and matures in March 2024. On July 1, 2023, the interest rate was changed to SOFR plus 3.75% with a SOFR floor of 0.25%. Interest income recorded from this loan was $1.5 million and $4.3 million for the three and nine months ended September 30, 2023, respectively, and $1.0 million and $2.5 million for the three and nine months ended September 30, 2022, respectively.

In 2020, we committed to fund a $32.5 million bridge loan ($24.5 million was funded at September 30, 2023) and made a $3.5 million preferred equity investment in an SFR build-to-rent construction project. An entity owned by an immediate family member of our chief executive officer also made an equity investment in the project and owns a 21.8% equity interest in the borrowing entity. The bridge loan had an interest rate of LIBOR plus 5.5% with a LIBOR floor of 0.75%, the preferred equity investment has a 12.0% fixed rate, and both loans mature in December 2023. On July 1, 2023, the bridge loan interest rate was changed to SOFR plus 5.5% with a SOFR floor of 0.75%. Interest income recorded from these loans was $0.8 million and $2.0 million for the three and nine months ended September 30, 2023, respectively, and $0.3 million and $0.8 million for the three and nine months ended September 30, 2022, respectively.

In 2020, we committed to fund a $30.5 million bridge loan and we made a $4.6 million preferred equity investment in a SFR build-to-rent construction project. ACM and an entity owned by an immediate family member of our chief executive officer also made equity investments in the project and own an 18.9% equity interest in the borrowing entity. The bridge loan had an interest rate of LIBOR plus 5.5% with a LIBOR floor of 0.75% and was scheduled to mature in May 2023 and the preferred equity investment has a 12.0% fixed rate and was scheduled to mature in April 2023. In April 2023, the bridge loan was upsized to a maximum of $38.4 million ($34.2 million was funded at September 30, 2023), and the interest rate was changed to SOFR plus 5.25% with a SOFR floor of 1.00%. In addition, the maturity on both loans was extended to May 2025. Interest income recorded from these loans was $1.0 million and $2.5 million for the three and nine months ended September 30, 2023, respectively, and $0.5 million and $1.0 million for the three and nine months ended September 30, 2022, respectively.

In 2020, we originated a $14.8 million Private Label loan and a $3.4 million mezzanine loan on two multifamily properties owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns a 50% interest in the borrowing entity. In 2020, we sold the Private Label loan to an unconsolidated affiliate of ours. The mezzanine loan bears interest at a 9.0% fixed rate and matures in April 2030. Interest income recorded from the mezzanine loan was $0.1 million for both the three months ended September 30, 2023 and 2022, and $0.2 million for both the nine months ended September 30, 2023 and 2022.

We have a $35.0 million bridge loan and a $10.0 million preferred equity interest on an office building. The bridge loan was scheduled to mature in July 2023 and was extended to October 30, 2023 and the preferred equity investment matures in June 2027. The property is controlled by a third party. The day-to-day operations are currently being managed by an immediate family member, or one of his affiliated entities, of our chief executive officer. In 2021, we entered into a forbearance agreement with the borrower on the outstanding bridge loan to defer all interest owed until maturity or early payoff. At both September 30, 2023 and December 31, 2022, these loans had an allowance for credit loss recorded against them totaling $8.0 million.

In 2019, we, along with ACM, certain executives of ours and a consortium of independent outside investors, formed AMAC III, a multifamily-focused commercial real estate investment fund sponsored and managed by our chief executive officer and one of his immediate family members. We committed to a $30.0 million investment ($25.2 million was funded at September 30, 2023) for an 18% interest in AMAC III. During the three and nine months ended September 30, 2023, we recorded losses associated with this investment of $0.7 million and $1.6 million, respectively, and during the nine months ended September 30, 2023, we received cash distributions of $1.1 million. During the three and nine months ended September 30, 2022, we recorded a loss associated with this investment of $0.7 million and $1.8 million, respectively, and we received distributions of $0.2 million and $0.4 million, respectively. In 2019, AMAC III originated

37

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

a $7.0 million mezzanine loan to a borrower with which we have an outstanding $34.0 million bridge loan. In 2020, for full satisfaction of the mezzanine loan, AMAC III became the owner of the property. Also in 2020, the $34.0 million bridge loan was refinanced with a $35.4 million bridge loan, which bore interest at a rate of LIBOR plus 3.5% and was scheduled to mature in August 2023, which was extended to August 2024. On July 1, 2023, the bridge loan interest rate was changed to SOFR plus 3.5%. Interest income recorded from the bridge loan was $0.8 million and $2.3 million for the three and nine months ended September 30, 2023, respectively, and $0.5 million and $1.2 million for the three and nine months ended September 30, 2022, respectively.

In 2018, we originated a $21.7 million bridge loan on a multifamily property owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns 75% in the borrowing entity. The loan had an interest rate of LIBOR plus 4.75% with a LIBOR floor of 0.25% and was scheduled to mature in August 2023, which was extended to August 2024. In addition, on July 1, 2023, the interest rate was changed to SOFR plus 4.75% with a SOFR floor of 0.25%. Interest income recorded from this loan was $0.6 million and $1.6 million for the three and nine months ended September 30, 2023, respectively, and $0.4 million and $1.0 million for the three and nine months ended September 30, 2022, respectively.

In 2017, we originated two bridge loans totaling $28.0 million on two multifamily properties owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns 45% of the borrowing entity. The loans had an interest rate of LIBOR plus 5.25% with LIBOR floors ranging from 1.24% to 1.54% and were scheduled to mature in 2020. The borrower refinanced these loans with a $31.1 million bridge loan we originated in 2019 with an interest rate of LIBOR plus 4.0%, a LIBOR floor of 1.8%, which was scheduled to mature in October 2022. In May 2022, this loan paid off in full. Interest income recorded from this loan was $0.8 million for the nine months ended September 30, 2022.

In 2017, we originated a $46.9 million Fannie Mae loan on a multifamily property owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers) which owns a 17.6% interest in the borrowing entity. We carry a maximum loss-sharing obligation with Fannie Mae on this loan of up to 5% of the original UPB. Servicing revenue recorded from this loan was less than $0.1 million for all periods presented.

In 2017, Ginkgo Investment Company LLC (“Ginkgo”), of which one of our directors is a 33% managing member, purchased a multifamily apartment complex which assumed an existing $8.3 million Fannie Mae loan that we service. Ginkgo subsequently sold the majority of its interest in this property and owned a 3.6% interest at September 30, 2023. We carried a maximum loss-sharing obligation with Fannie Mae on this loan of up to 20% of the original UPB. Upon the sale, we received a 1% loan assumption fee which was governed by existing loan agreements that were in place when the loan was originated in 2015, prior to such purchase. In July 2023, the Fannie Mae loan was paid off in full. Servicing revenue recorded from this loan was less than $0.1 million for all periods presented.

In 2016, we originated $48.0 million of bridge loans on six multifamily properties owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns interests ranging from 10.5% to 12% in the borrowing entities. The loans had an interest rate of LIBOR plus 4.5% with a LIBOR floor of 0.25% and were scheduled to mature in 2019. In 2017, a $6.8 million loan on one property paid off in full and in 2018 four additional loans totaling $28.3 million paid off in full. In 2019, $10.9 million of the $12.9 million remaining bridge loan paid off, with the $2.0 million remaining UPB converting to a mezzanine loan with a fixed interest rate of 10.0% and a January 2024 maturity. Interest income recorded from the mezzanine loan was $0.1 million for all periods presented.

In 2015, we invested $9.6 million for 50% of ACM’s indirect interest in a joint venture with a third party that was formed to invest in a residential mortgage banking business. At September 30, 2023, we had an indirect interest of 12.3% in this entity. We recorded a loss of $1.3 million and income of $1.3 million related to this investment in the three and nine months ended September 30, 2023, respectively, and income of $0.3 million and $6.4 million in the three and nine months ended September 30, 2022, respectively. During the three and nine months ended September 30, 2023, we received cash distributions of $7.5 million and $15.0 million, respectively, and during the three and nine months ended September 30, 2022, we received cash distributions of $7.3 million and $22.3 million, respectively, which were classified as returns of capital.

We, along with an executive officer of ours and a consortium of independent outside investors, hold equity investments in a portfolio of multifamily properties referred to as the “Lexford” portfolio, which is managed by an entity owned primarily by a consortium of affiliated investors, including our chief executive officer and an executive officer of ours. Based on the terms of the management contract, the management company is entitled to 4.75% of gross revenues of the underlying properties, along with the potential to share in the proceeds of a sale or restructuring of the debt. In 2018, the owners of Lexford restructured part of its debt and we originated 12 bridge loans totaling $280.5 million, which were used to repay in full certain existing mortgage debt and to renovate 72 multifamily properties included in the portfolio. The loans were originated in 2018, had interest rates of LIBOR plus 4.0% and were scheduled to mature in June 2021. During 2019, the borrower made payoffs and partial paydowns of principal totaling $250.0 million and in 2020, the remaining balance of the loans were refinanced with a $34.6 million Private Label loan, which bears interest at a fixed rate of 3.3% and matures in March 2030. In 2020, we sold the Private Label loan to an unconsolidated affiliate of ours. Further, as part of this 2018 restructuring,

38

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

$50.0 million in unsecured financing was provided by an unsecured lender to certain parent entities of the property owners. ACM owns slightly less than half of the unsecured lender entity and, therefore, provided slightly less than half of the unsecured lender financing. In addition, in connection with our equity investment, we received distributions totaling $7.2 million during the nine months ended September 30, 2023, and $5.0 million and $11.0 million during the three and nine months ended September 30, 2022, respectively, which were recorded as income from equity affiliates. Separate from the loans we originated in 2018, we provide limited (“bad boy”) guarantees for certain other debt controlled by Lexford. The bad boy guarantees may become a liability for us upon standard “bad” acts such as fraud or a material misrepresentation by Lexford or us. At September 30, 2023, this debt had an aggregate outstanding balance of approximately $600.0 million and is scheduled to mature through 2029.

Several of our executives, including our chief financial officer, corporate secretary and our chairman, chief executive officer and president, hold similar positions for ACM. Our chief executive officer and his affiliated entities (“the Kaufman Entities”) together beneficially own approximately 35% of the outstanding membership interests of ACM and certain of our employees and directors also hold an ownership interest in ACM. Furthermore, one of our directors serves as the trustee and co-trustee of two of the Kaufman Entities that hold membership interests in ACM. At September 30, 2023, ACM holds 2,535,870 shares of our common stock and 10,615,085 OP Units, which represents 6.4% of the voting power of our outstanding stock. Our Board of Directors approved a resolution under our charter allowing our chief executive officer and ACM, (which our chief executive officer has a controlling equity interest in), to own more than the 5% ownership interest limit of our common stock as stated in our amended charter.

39

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Note 18 — Segment Information

The summarized statements of income and balance sheet data, as well as certain other data, by segment are included in the following tables ($ in thousands). Specifically identifiable costs are recorded directly to each business segment. For items not specifically identifiable, costs have been allocated between the business segments using the most meaningful allocation methodologies, which was predominately direct labor costs (i.e., time spent working on each business segment). Such costs include, but are not limited to, compensation and employee related costs, selling and administrative expenses and stock-based compensation.

	Three Months Ended September 30, 2023
	Structured Business		Agency Business		Other / Eliminations (1)		Consolidated
Interest income	$	322,819	$	13,655	$	—	$	336,474
Interest expense	222,996		6,184		—		229,180
Net interest income	99,823		7,471		—		107,294
Other revenue:
Gain on sales, including fee-based services, net	—		18,619		—		18,619
Mortgage servicing rights	—		14,109		—		14,109
Servicing revenue	—		51,363		—		51,363
Amortization of MSRs	—		(15,900)		—		(15,900)
Property operating income	1,450		—		—		1,450
Loss on derivative instruments, net	—		(421)		—		(421)
Other income (loss), net	751		(578)		—		173
Total other revenue	2,201		67,192		—		69,393
Other expenses:
Employee compensation and benefits	12,912		26,898		—		39,810
Selling and administrative	5,291		7,076		—		12,367
Property operating expenses	1,479		—		—		1,479
Depreciation and amortization	1,114		1,172		—		2,286
Provision for loss sharing (net of recoveries)	—		1,679		—		1,679
Provision for credit losses (net of recoveries)	17,243		1,409		—		18,652
Total other expenses	38,039		38,234		—		76,273
Income before extinguishment of debt, income from equity affiliates and income taxes	63,985		36,429		—		100,414
Loss on extinguishment of debt	(314)		—		—		(314)
Income from equity affiliates	809		—		—		809
Provision for income taxes	1,078		(6,932)		—		(5,854)
Net income	65,558		29,497		—		95,055
Preferred stock dividends	10,342		—		—		10,342
Net income attributable to noncontrolling interest	—		—		6,789		6,789
Net income attributable to common stockholders	$	55,216	$	29,497	$	(6,789)	$	77,924

40

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

	Three Months Ended September 30, 2022
	Structured Business		Agency Business		Other / Eliminations (1)		Consolidated
Interest income	$	249,539	$	10,239	$	—	$	259,778
Interest expense	157,325		3,127		—		160,452
Net interest income	92,214		7,112		—		99,326
Other revenue:
Gain on sales, including fee-based services, net	—		14,360		—		14,360
Mortgage servicing rights	—		19,408		—		19,408
Servicing revenue	—		37,526		—		37,526
Amortization of MSRs	—		(14,782)		—		(14,782)
Property operating income	445		—		—		445
Loss on derivative instruments, net	—		(15,909)		—		(15,909)
Other income (loss), net	1,763		(7,777)		—		(6,014)
Total other revenue	2,208		32,826		—		35,034
Other expenses:
Employee compensation and benefits	13,342		25,469		—		38,811
Selling and administrative	5,961		7,264		—		13,225
Property operating expenses	366		—		—		366
Depreciation and amortization	906		1,172		—		2,078
Provision for loss sharing (net of recoveries)	—		412		—		412
Provision for credit losses (net of recoveries)	2,206		68		—		2,274
Total other expenses	22,781		34,385		—		57,166
Income before extinguishment of debt, income from equity affiliates and income taxes	71,641		5,553		—		77,194
Loss on extinguishment of debt	(3,262)		—		—		(3,262)
Income from equity affiliates	4,748		—		—		4,748
Benefit for income taxes	319		55		—		374
Net income	73,446		5,608		—		79,054
Preferred stock dividends	10,342		—		—		10,342
Net income attributable to noncontrolling interest	—		—		6,002		6,002
Net income attributable to common stockholders	$	63,104	$	5,608	$	(6,002)	$	62,710

41

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

	Nine Months Ended September 30, 2023
	Structured Business		Agency Business		Other / Eliminations (1)		Consolidated
Interest income	$	962,301	$	37,858	$	—	$	1,000,159
Interest expense	658,856		16,893		—		675,749
Net interest income	303,445		20,965		—		324,410
Other revenue:
Gain on sales, including fee-based services, net	—		55,795		—		55,795
Mortgage servicing rights	—		48,769		—		48,769
Servicing revenue	—		144,296		—		144,296
Amortization of MSRs	—		(46,920)		—		(46,920)
Property operating income	4,261		—		—		4,261
Loss on derivative instruments, net	—		(3,582)		—		(3,582)
Other income, net	3,420		1,679		—		5,099
Total other revenue	7,681		200,037		—		207,718
Other expenses:
Employee compensation and benefits	41,991		81,527		—		123,518
Selling and administrative	17,835		20,739		—		38,574
Property operating expenses	4,227		—		—		4,227
Depreciation and amortization	3,779		3,518		—		7,297
Provision for loss sharing (net of recoveries)	—		12,528		—		12,528
Provision for credit losses (net of recoveries)	52,257		2,790		—		55,047
Total other expenses	120,089		121,102		—		241,191
Income before extinguishment of debt, income from equity affiliates and income taxes	191,037		99,900		—		290,937
Loss on extinguishment of debt	(1,561)		—		—		(1,561)
Income from equity affiliates	20,694		—		—		20,694
Provision for income taxes	307		(19,743)		—		(19,436)
Net income	210,477		80,157		—		290,634
Preferred stock dividends	31,027		—		—		31,027
Net income attributable to noncontrolling interest	—		—		21,200		21,200
Net income attributable to common stockholders	$	179,450	$	80,157	$	(21,200)	$	238,407

42

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

	Nine Months Ended September 30, 2022
	Structured Business		Agency Business		Other / Eliminations (1)		Consolidated
Interest income	$	597,847	$	29,957	$	—	$	627,804
Interest expense	338,692		11,387		—		350,079
Net interest income	259,155		18,570		—		277,725
Other revenue:
Gain on sales, including fee-based services, net	—		32,526		—		32,526
Mortgage servicing rights	—		52,287		—		52,287
Servicing revenue	—		109,045		—		109,045
Amortization of MSRs	—		(44,532)		—		(44,532)
Property operating income	1,031		—		—		1,031
Gain on derivative instruments, net	—		10,083		—		10,083
Other loss, net	(4,370)		(11,691)		—		(16,061)
Total other revenue	(3,339)		147,718		—		144,379
Other expenses:
Employee compensation and benefits	42,694		77,042		—		119,736
Selling and administrative	19,799		21,161		—		40,960
Property operating expenses	1,443		—		—		1,443
Depreciation and amortization	2,574		3,518		—		6,092
Provision for loss sharing (net of recoveries)	—		(2,199)		—		(2,199)
Provision for credit losses (net of recoveries)	9,363		337		—		9,700
Total other expenses	75,873		99,859		—		175,732
Income before extinguishment of debt, income from equity affiliates and income taxes	179,943		66,429		—		246,372
Loss on extinguishment of debt	(4,612)		—		—		(4,612)
Income from equity affiliates	18,507		—		—		18,507
Provision for income taxes	(1,368)		(11,798)		—		(13,166)
Net income	192,470		54,631		—		247,101
Preferred stock dividends	30,612		—		—		30,612
Net income attributable to noncontrolling interest	—		—		19,811		19,811
Net income attributable to common stockholders	$	161,858	$	54,631	$	(19,811)	$	196,678

________________________

(1)Includes income allocated to the noncontrolling interest holders not allocated to the two reportable segments.

43

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

	September 30, 2023
	Structured Business		Agency Business		Consolidated
Assets:
Cash and cash equivalents	$	499,511	$	395,787	$	895,298
Restricted cash	410,056		9,102		419,158
Loans and investments, net	12,892,796		—		12,892,796
Loans held-for-sale, net	—		364,320		364,320
Capitalized mortgage servicing rights, net	—		392,203		392,203
Securities held-to-maturity, net	—		155,172		155,172
Investments in equity affiliates	62,795		—		62,795
Goodwill and other intangible assets	12,500		80,051		92,551
Other assets and due from related party	536,789		91,607		628,396
Total assets	$	14,414,447	$	1,488,242	$	15,902,689
Liabilities:
Debt obligations	$	11,800,537	$	354,587	$	12,155,124
Allowance for loss-sharing obligations	—		69,261		69,261
Other liabilities and due to related parties	323,061		114,742		437,803
Total liabilities	$	12,123,598	$	538,590	$	12,662,188
	December 31, 2022
Assets:
Cash and cash equivalents	$	200,514	$	333,843	$	534,357
Restricted cash	713,615		193		713,808
Loans and investments, net	14,254,674		—		14,254,674
Loans held-for-sale, net	—		354,070		354,070
Capitalized mortgage servicing rights, net	—		401,471		401,471
Securities held-to-maturity, net	—		156,547		156,547
Investments in equity affiliates	79,130		—		79,130
Goodwill and other intangible assets	12,500		83,569		96,069
Other assets and due from related party	367,837		81,022		448,859
Total assets	$	15,628,270	$	1,410,715	$	17,038,985
Liabilities:
Debt obligations	$	13,195,120	$	305,442	$	13,500,562
Allowance for loss-sharing obligations	—		57,168		57,168
Other liabilities and due to related parties	299,559		109,817		409,376
Total liabilities	$	13,494,679	$	472,427	$	13,967,106

44

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Origination Data:
Structured Business
Bridge:
Multifamily	$	92,000		$	592,844		$	376,630		$	5,172,770
SFR	140,379			163,851			325,432			452,240
	232,379			756,695			702,062			5,625,010
Mezzanine / Preferred Equity	7,779			17,970			15,124			26,109
Total new loan originations	$	240,158		$	774,665		$	717,186		$	5,651,119
Number of Loans Originated	42			52			92			268
SFR Commitments	$	429,452		$	457,564		$	683,984		$	726,071
Loan runoff	$	664,792		$	911,790		$	2,536,661		$	2,700,748
Agency Business
Origination Volumes by Investor:
Fannie Mae	$	721,398		$	629,610		$	2,596,329		$	1,744,739
Freddie Mac	339,241			350,980			658,457			1,057,743
FHA	19,215			78,382			230,707			168,736
Private Label	67,965			35,671			159,328			191,913
SFR - Fixed Rate	2,030			16,678			19,328			55,883
Total	$	1,149,849		$	1,111,321		$	3,664,149		$	3,219,014
Total loan commitment volume	$	1,211,347		$	1,464,235		$	3,844,769		$	3,623,649
Agency Business Loan Sales Data:
Fannie Mae	$	837,132		$	700,690		$	2,511,978		$	1,936,282
Freddie Mac	337,507			288,029			581,306			1,009,557
FHA	24,057			35,838			201,915			182,755
Private Label	67,965			14,567			300,713			515,086
SFR - Fixed Rate	8,759			43,012			22,931			55,874
Total	$	1,275,420		$	1,082,136		$	3,618,843		$	3,699,554
Sales margin (fee-based services as a % of loan sales) (1)	1.46		%	1.33		%	1.54		%	1.34		%
MSR rate (MSR income as a % of loan commitments)	1.16		%	1.33		%	1.27		%	1.44		%

________________________

(1)The nine months ended September 30, 2022 includes $17.1 million of gains recognized on Swaps related to the Private Label loans sold, which is included in gain (loss) on derivative instruments, net in the consolidated statements of income.

45

ARBOR REALTY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

	September 30, 2023
Key Servicing Metrics for Agency Business:	Servicing Portfolio UPB		Wtd. Avg. Servicing Fee Rate (basis points)	Wtd. Avg. Life of Servicing Portfolio (years)
Fannie Mae	$	20,463,620	48.3	7.7
Freddie Mac	5,184,888		24.2	8.5
Private Label	2,371,475		19.2	7.3
FHA	1,322,832		14.5	19.9
Bridge	305,950		11.2	3.6
SFR - Fixed Rate	287,942		20.1	5.8
Total	$	29,936,707	39.7	8.3
	December 31, 2022
Fannie Mae	$	19,038,124	50.2	8.0
Freddie Mac	5,153,207		25.0	9.0
Private Label	2,074,859		18.5	7.6
FHA	1,155,893		14.9	19.5
Bridge	301,182		12.5	1.7
SFR - Fixed Rate	274,764		19.8	6.0
Total	$	27,998,029	41.1	8.6

46

Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion in conjunction with the unaudited consolidated interim financial statements, and related notes and the section entitled “Forward-Looking Statements” included herein.

Overview

Through our Structured Business, we invest in a diversified portfolio of structured finance assets in the multifamily, SFR and commercial real estate markets, primarily consisting of bridge loans, in addition to mezzanine loans, junior participating interests in first mortgages and preferred and direct equity. We also invest in real estate-related joint ventures and may directly acquire real property and invest in real estate-related notes and certain mortgage-related securities.

Through our Agency Business, we originate, sell and service a range of multifamily finance products through Fannie Mae and Freddie Mac, Ginnie Mae, FHA and HUD. We retain the servicing rights and asset management responsibilities on substantially all loans we originate and sell under the GSE and HUD programs. We are an approved Fannie Mae DUS lender nationally, a Freddie Mac Multifamily Conventional Loan lender, seller/servicer, in New York, New Jersey and Connecticut, a Freddie Mac affordable, manufactured housing, senior housing and SBL lender, seller/servicer, nationally and a HUD MAP and LEAN senior housing/healthcare lender nationally. We also originate and service permanent financing loans underwritten using the guidelines of our existing agency loans sold to the GSEs, which we refer to as “Private Label” loans and originate and sell finance products through CMBS programs. We pool and securitize the Private Label loans and sell certificates in the securitizations to third-party investors, while retaining the servicing rights and APL certificates of the securitization.

We conduct our operations to qualify as a REIT. A REIT is generally not subject to federal income tax on its REIT—taxable income that is distributed to its stockholders, provided that at least 90% of its REIT—taxable income is distributed and provided that certain other requirements are met.

Our operating performance is primarily driven by the following factors:

Net interest income earned on our investments. Net interest income represents the amount by which the interest income earned on our assets exceeds the interest expense incurred on our borrowings. If the yield on our assets increases or the cost of borrowings decreases, this will have a positive impact on earnings. However, if the yield earned on our assets decreases or the cost of borrowings increases, this will have a negative impact on earnings. Net interest income is also directly impacted by the size and performance of our asset portfolio. We recognize the bulk of our net interest income from our Structured Business. Additionally, we recognize net interest income from loans originated through our Agency Business, which are generally sold within 60 days of origination.

Fees and other revenues recognized from originating, selling and servicing mortgage loans through the GSE and HUD programs. Revenue recognized from the origination and sale of mortgage loans consists of gains on sale of loans (net of any direct loan origination costs incurred), commitment fees, broker fees, loan assumption fees and loan origination fees. These gains and fees are collectively referred to as gain on sales, including fee-based services, net. We record income from MSRs at the time of commitment to the borrower, which represents the fair value of the expected net future cash flows associated with the rights to service mortgage loans that we originate, with the recognition of a corresponding asset upon sale. We also record servicing revenue which consists of fees received for servicing mortgage loans, net of amortization on the MSR assets recorded. Although we have long-established relationships with the GSE and HUD agencies, our operating performance would be negatively impacted if our business relationships with these agencies deteriorate. Additionally, we also recognize revenue from originating, selling and servicing our Private Label loans.

Income earned from our structured transactions. Our structured transactions are primarily comprised of investments in equity affiliates, which represent unconsolidated joint venture investments formed to acquire, develop and/or sell real estate-related assets. Operating results from these investments can be difficult to predict and can vary significantly period-to-period. When interest rates rise, the income from these investments can be significantly and negatively impacted, particularly from our investment in a residential mortgage banking business, since rising interest rates generally decrease the demand for residential real estate loans. In addition, we periodically receive distributions from our equity investments. It is difficult to forecast the timing of such payments, which can be substantial in any given quarter. We account for structured transactions within our Structured Business.

Credit quality of our loans and investments, including our servicing portfolio. Effective portfolio management is essential to maximize the performance and value of our loan and investment and servicing portfolios. Maintaining the credit quality of the loans in our portfolios is of critical importance. Loans that do not perform in accordance with their terms may have a negative impact on earnings and liquidity.

47

Significant Developments During the Third Quarter of 2023

Financing and Capital Markets Activity.

•Unwound CLO 12, redeeming the remaining outstanding notes, which were repaid primarily from the refinancing of the remaining assets within our other CLO vehicles and credit and repurchase facilities; and

•Raised $84.0 million of capital from issuances of approximately 5.6 million shares of common stock under our “At-The-Market” equity offering sales agreement.

Structured Business Activity. Our structured loan and investment portfolio decreased approximately 3% to $13.12 billion as loan runoff totaling $664.8 million outpaced loan originations totaling $240.2 million.

Agency Business Activity.

•Loan originations and sales totaled $1.15 billion and $1.28 billion, respectively; and

•Grew our fee-based servicing portfolio approximately 2%, or $490.2 million, to $29.94 billion.

Current Market Conditions, Risks and Recent Trends

The Federal Reserve has raised interest rates throughout 2022 and during the first nine months of 2023 to combat inflation and restore price stability. As inflation begins to cool, it is possible that the rate hikes from the Federal Reserve will slow, or pause during the remainder of 2023.

We have been very successful in raising capital through various vehicles to grow our businesses. Inflation, rising interest rates, bank failures, and geopolitical uncertainty has caused significant disruptions in many market segments, including the financial services, real estate and credit markets, which has, and may continue, to result in a further dislocation in capital markets and a continual reduction of available liquidity. Instability in the banking sector, such as the recent bank failures and consolidations, further contributed to the tightening liquidity conditions in the equity and capital markets and has affected the availability and increased the cost of capital. The increased cost of credit, or degradation in debt financing terms, may impact our ability to identify and execute investments on attractive terms, or at all.

Additionally, the turmoil in the banking sector and financial markets has resulted in multiple regional bank failures and consolidations. Although the majority of our cash is currently on deposit with major financial institutions, our balances often exceed insured limits. We limit the exposure relating to these balances by diversifying them among various counterparties. Generally, deposits may be redeemed upon demand and are maintained at financial institutions with reputable credit and therefore we believe bear minimal credit risk.

These current market conditions could continue to limit our ability to grow our Structured Business since this business is more reliant on the capital markets to grow, but can also present us with options to build on existing relationships or create new relationships with lenders. Since our Agency Business requires limited capital to grow, as originations are financed through warehouse facilities for generally up to 60 days before the loans are sold, tightening liquidity conditions in equity and capital markets should not have a substantial impact on our ability to continue to grow this business.

Although we have not been significantly impacted by these adverse economic conditions to date, such conditions have resulted, and may continue to result, in a dislocation in capital markets, declining real estate values of certain asset classes, increased payment delinquencies and defaults and increased loan modifications and foreclosures, all of which could have a significant impact on our future results of operations, financial condition, business prospects and our ability to make distributions to our stockholders.

We are currently in a high interest rate environment and expect that some of our borrowers may experience financial stress that could result in the recognition of losses on certain loans. We employ rigorous risk management and underwriting practices to proactively maintain the quality of our loan portfolio and work very closely with borrowers to mitigate potential losses while safeguarding the integrity of our portfolio. Given the current elevated interest rate environment, we cannot guarantee that our loan portfolio will perform under the terms originally established.

Currently, rising interest rates will positively impact our net interest income since our structured loan portfolio exceeds our corresponding debt balances and the vast majority of our loan portfolio is floating-rate based on SOFR. In addition, a greater portion of our debt is fixed-rate (convertible and senior unsecured notes), as compared to our structured loan portfolio, and will not reset as interest rates rise. Therefore, increases in interest income due to rising interest rates is likely to be greater than the corresponding increase in interest expense on our variable rate debt. Additionally, we earn interest on our escrow and cash balances, so an increasing interest rate environment will increase our earnings on such balances. See “Quantitative and Qualitative Disclosures about Market Risk” below for additional details. Conversely, such rising interest rates could negatively impact real estate values and limit a borrower’s ability to make debt service

48

payments, which may limit new mortgage loan originations and increase the likelihood of incurring losses from defaulted loans if the reduction in the collateral value is insufficient to repay their loans in full.

We are a national originator with Fannie Mae and Freddie Mac, and the GSEs remain the most significant providers of capital to the multifamily market. In November 2022, the Federal Housing Finance Agency (“FHFA”) announced that its 2023 Caps for Fannie Mae and Freddie Mac will be $75 billion for each enterprise for a total opportunity of $150 billion (the “2023 Caps”), which has decreased from its 2022 loan origination caps of $78 billion for each enterprise. The FHFA has stated that they will continue to monitor the market and reserves the right to increase the 2023 Caps if warranted, however, they will not reduce the 2023 Caps if the market is smaller than initially projected. The 2023 Caps will continue to apply to all multifamily business, have no exclusions, and mandate that 50% be directed towards mission driven, affordable housing. The FHFA has removed the requirement that at least 25% be affordable to residents at or below 60% of area median income (“AMI”) to reduce inconsistencies with their Housing Goals regulation. Further, the FHFA has changed certain definitions of mission driven affordable housing and also allows loans to finance energy or water efficiency improvements with units affordable at or below 80% of AMI to be classified as mission-driven, up from 60% AMI in 2022. This increase will allow the GSEs to expand their effort on energy and water conservation measures at workforce housing properties. Our originations with the GSEs are highly profitable executions as they provide significant gains from the sale of our loans, non-cash gains related to MSRs and servicing revenues. As a result of the current elevated interest rate environment and the uncertainty whether the FHFA will impose stricter limitations on GSE multifamily production volume in the future, we could experience a decline in our GSE originations, which would negatively impact our financial results.

Changes in Financial Condition

Assets — Comparison of balances at September 30, 2023 to December 31, 2022:

Our Structured loan and investment portfolio balance was $13.12 billion and $14.46 billion at September 30, 2023 and December 31, 2022, respectively. This decrease was primarily due to loan runoff exceeding loan originations by $1.82 billion. See below for details.

Our portfolio had a weighted average current interest pay rate of 8.80% and 8.17% at September 30, 2023 and December 31, 2022, respectively. Including certain fees earned and costs associated with the structured portfolio, the weighted average current interest rate was 9.12% and 8.42% at September 30, 2023 and December 31, 2022, respectively. Our debt that finances our loans and investment portfolio totaled $11.86 billion and $13.28 billion at September 30, 2023 and December 31, 2022, respectively, with a weighted average funding cost of 7.09% and 6.22%, respectively, which excludes financing costs. Including financing costs, the weighted average funding rate was 7.41% and 6.50% at September 30, 2023 and December 31, 2022, respectively.

Activity from our Structured Business portfolio is comprised of the following ($ in thousands):

	Three Months Ended September 30, 2023			Nine Months Ended September 30, 2023
Loans originated	$	240,158		$	717,186
Number of loans	42			92
Weighted average interest rate	10.10		%	9.83		%
Loan runoff	$	664,792		$	2,536,661
Number of loans	36			142
Weighted average interest rate	9.45		%	9.13		%
Loans extended	$	347,665		$	1,013,995
Number of loans	14			44

49

Loans held-for-sale from the Agency Business increased $10.3 million, primarily from loan originations exceeding loan sales by $45.3 million as noted in the following table, partially offset by unfunded construction loan originations of $38.4 million. Activity from our Agency Business portfolio is comprised of the following (in thousands):

	Three Months Ended September 30, 2023				Nine Months Ended September 30, 2023
	Loan Originations		Loan Sales		Loan Originations		Loan Sales
Fannie Mae	$	721,398	$	837,132	$	2,596,329	$	2,511,978
Freddie Mac	339,241		337,507		658,457		581,306
FHA	19,215		24,057		230,707		201,915
Private Label	67,965		67,965		159,328		300,713
SFR - Fixed Rate	2,030		8,759		19,328		22,931
Total	$	1,149,849	$	1,275,420	$	3,664,149	$	3,618,843

Investments in equity affiliates decreased $16.3 million, primarily due to $15.0 million of cash distributions received from our investment in a residential mortgage banking business.

Due from related party increased $134.2 million, due to an increase in funds from payoffs to be remitted by our affiliated servicing operations related to real estate transactions at the end of the reporting period, which were remitted to us subsequent to quarter end.

Other assets increased $45.3 million, primarily due to an increase in unsecured loan fundings.

Liabilities – Comparison of balances at September 30, 2023 to December 31, 2022:

Credit and repurchase facilities decreased $450.4 million, primarily due to loan runoff in our Structured Business portfolio, partially offset by loan originations exceeding sales in our Agency Business.

Securitized debt decreased $844.6 million, primarily due to the unwind of CLO 13 and 12.

Senior unsecured notes decreased $53.1 million, primarily due to the repurchases of our 8.00% and 5.625% senior notes totaling $149.6 million, partially offset by the issuance of $95.0 million of 7.75% senior notes.

Due to borrowers increased $53.4 million, primarily due to unfunded commitments on new loan originations in our Structured Business, partially offset by the funding of previously committed originations.

Other liabilities decreased $14.8 million, primarily due to payments of accrued interest on our senior and convertible notes and decreases in accrued professional fees in connection with the settlement of the Extended Stay litigation in the first quarter of 2023.

Equity

During the nine months ended September 30, 2023, we sold 13,113,296 shares of our common stock through our “At-The-Market” equity agreement at an average price of $14.77 per share.

See Note 15 for details of our dividends declared and deferred compensation transactions.

50

Agency Servicing Portfolio

The following table sets forth the characteristics of our loan servicing portfolio collateralizing our mortgage servicing rights and servicing revenue ($ in thousands):

	September 30, 2023
Product	Servicing Portfolio UPB		Loan Count	Wtd. Avg. Age of Portfolio (years)	Wtd. Avg. Portfolio Maturity (years)	Interest Rate Type				Wtd. Avg. Note Rate		Annualized Prepayments as a % of Portfolio (1)		Delinquencies as a % of Portfolio (2)
						Fixed		Adjustable
Fannie Mae	$	20,463,620	2,519	3.3	8.1	95	%	5	%	4.42	%	5.75	%	0.62	%
Freddie Mac	5,184,888		1,153	3.1	9.2	83	%	17	%	4.68	%	9.03	%	4.31	%
Private Label	2,371,475		149	2.4	7.1	100	%	—		3.86	%	—		—
FHA	1,322,832		104	2.8	33.1	100	%	—		3.44	%	—		—
Bridge	305,950		3	1.2	3.0	54	%	46	%	7.22	%	—		—
SFR - Fixed Rate	287,942		59	2.0	5.6	100	%	—		5.19	%	1.56	%	—
Total	$	29,936,707	3,987	3.2	9.1	93	%	7	%	4.42	%	5.51	%	1.17	%
	December 31, 2022
Fannie Mae	$	19,038,124	2,460	3.1	8.5	96	%	4	%	4.20	%	12.71	%	0.13	%
Freddie Mac	5,153,207		1,214	2.8	10.2	84	%	16	%	4.26	%	19.78	%	0.27	%
Private Label	2,074,859		130	1.9	7.8	100	%	—		3.60	%	—		—
FHA	1,155,893		96	2.5	33.5	100	%	—		3.17	%	1.59	%	—
Bridge	301,182		4	0.9	1.6	—		100	%	7.68	%	—		—
SFR - Fixed Rate	274,764		53	1.4	6.3	100	%	—		5.04	%	0.30	%	—
Total	$	27,998,029	3,957	2.9	9.7	93	%	7	%	4.17	%	12.35	%	0.14	%

________________________

(1)Prepayments reflect loans repaid prior to six months from the loan maturity. The majority of our loan servicing portfolio has a prepayment protection term and therefore, we may collect a prepayment fee which is included as a component of servicing revenue, net. See Note 5 for details.

(2)Delinquent loans reflect loans that are contractually 60 days or more past due. At September 30, 2023 and December 31, 2022, delinquent loans totaled $351.0 million and $38.7 million, respectively. At September 30, 2023, there were two loans totaling $4.8 million in bankruptcy and no loans in foreclosure. There were no loans in bankruptcy or foreclosure at December 31, 2022.

Our Agency Business servicing portfolio represents commercial real estate loans, which are generally transferred or sold within 60 days from the date the loan is funded. Primarily all loans in our servicing portfolio are collateralized by multifamily properties. In addition, we are generally required to share in the risk of any losses associated with loans sold under the Fannie Mae DUS program, see Note 10.

51

Comparison of Results of Operations for the Three Months Ended September 30, 2023 and 2022

The following table provides our consolidated operating results ($ in thousands):

	Three Months Ended September 30,				Increase / (Decrease)
	2023		2022		Amount		Percent
Interest income	$	336,474	$	259,778	$	76,696	30	%
Interest expense	229,180		160,452		68,728		43	%
Net interest income	107,294		99,326		7,968		8	%
Other revenue:
Gain on sales, including fee-based services, net	18,619		14,360		4,259		30	%
Mortgage servicing rights	14,109		19,408		(5,299)		(27)	%
Servicing revenue, net	35,463		22,744		12,719		56	%
Property operating income	1,450		445		1,005		nm
Loss on derivative instruments, net	(421)		(15,909)		15,488		(97)	%
Other income (loss), net	173		(6,014)		6,187		nm
Total other revenue	69,393		35,034		34,359		98	%
Other expenses:
Employee compensation and benefits	39,810		38,811		999		3	%
Selling and administrative	12,367		13,225		(858)		(6)	%
Property operating expenses	1,479		366		1,113		nm
Depreciation and amortization	2,286		2,078		208		10	%
Provision for loss sharing (net of recoveries)	1,679		412		1,267		nm
Provision for credit losses (net of recoveries)	18,652		2,274		16,378		nm
Total other expenses	76,273		57,166		19,107		33	%
Income before extinguishment of debt, income from equity affiliates and income taxes	100,414		77,194		23,220		30	%
Loss on extinguishment of debt	(314)		(3,262)		2,948		(90)	%
Income from equity affiliates	809		4,748		(3,939)		(83)	%
(Provision for) benefit from income taxes	(5,854)		374		(6,228)		nm
Net income	95,055		79,054		16,001		20	%
Preferred stock dividends	10,342		10,342		—		—
Net income attributable to noncontrolling interest	6,789		6,002		787		13	%
Net income attributable to common stockholders	$	77,924	$	62,710	$	15,214	24	%

________________________

nm — not meaningful

52

The following table presents the average balance of our Structured Business interest-earning assets and interest-bearing liabilities, associated interest income (expense) and the corresponding weighted average yields ($ in thousands):

	Three Months Ended September 30,
	2023						2022
	Average Carrying Value (1)		Interest Income / Expense		W/A Yield / Financing Cost (2)		Average Carrying Value (1)		Interest Income / Expense		W/A Yield / Financing Cost (2)
Structured Business interest-earning assets:
Bridge loans	$	13,072,890	$	305,654	9.28	%	$	14,638,998	$	239,534	6.49	%
Mezzanine / junior participation loans	225,518		5,620		9.89	%	184,840		4,623		9.92	%
Preferred equity investments	87,812		955		4.32	%	147,447		2,888		7.77	%
Other	10,227		250		9.70	%	36,117		1,639		18.00	%
Core interest-earning assets	13,396,447		312,479		9.25	%	15,007,402		248,684		6.57	%
Cash equivalents	852,513		10,340		4.81	%	1,003,703		855		0.34	%
Total interest-earning assets	$	14,248,960	$	322,819	8.99	%	$	16,011,105	$	249,539	6.18	%
Structured Business interest-bearing liabilities:
CLO	$	6,881,648	$	126,085	7.27	%	$	8,009,329	$	79,640	3.94	%
Credit and repurchase facilities	3,108,670		63,831		8.15	%	4,116,797		52,461		5.06	%
Unsecured debt	1,632,500		25,310		6.15	%	1,615,268		23,166		5.69	%
Q Series securitization	225,930		4,453		7.82	%	—		—		—
Trust preferred	154,336		3,317		8.53	%	154,336		2,058		5.29	%
Total interest-bearing liabilities	$	12,003,084	222,996		7.37	%	$	13,895,730	157,325		4.49	%
Net interest income			$	99,823					$	92,214

________________________

(1)Based on UPB for loans, amortized cost for securities and principal amount of debt.

(2)Weighted average yield calculated based on annualized interest income or expense divided by average carrying value.

Net Interest Income

The increase in interest income was mainly due to a $73.3 million increase from our Structured Business, primarily due to a significant increase in the average yield on core interest-earning assets, as a result of increases in benchmark interest rates, partially offset by a decrease in our average balance of our core interest-earning assets, mainly from loan runoff exceeding loan originations.

The increase in interest expense was mainly due to a $65.7 million increase from our Structured Business, primarily due to a significant increase in the average cost of our interest-bearing liabilities, mainly from increases in benchmark index rates, partially offset by a decrease in the average balance of our interest-bearing liabilities, due to loan runoff.

Agency Business Revenue

The increase in gain on sales, including fee-based services, net was primarily due to an 18% increase in loan sales volume ($193.3 million) and a 10% increase in the sales margin from 1.33% to 1.46%. The increase in the sales margin was primarily driven by higher margins received on Fannie Mae loan sales.

The decrease in income from MSRs was primarily due to a 17% decrease in loan commitment volume ($252.9 million) and a 12% decrease in the MSR rate from 1.33% to 1.16%. The decrease in the MSR rate was primarily due to a reduction in servicing rates on newer loans.

The increase in servicing revenue, net was primarily due to an increase in earnings on escrow balances as a result of increases in benchmark index rates, partially offset by less prepayment penalties received.

53

Other Income (Loss)

The losses on derivative instruments in both 2023 and 2022 were related to changes in the fair values of our forward sale commitments and Swaps held by our Agency Business as a result of changes in market interest rates as well as from the timing of GSE Agency loan sales.

Other income (loss), net in 2022 primarily reflects a $7.8 million unrealized impairment loss recorded on certain loans held-for sale in our Agency Business.

Other Expenses

The increase in employee compensation and benefits expense was primarily due to increases in headcount.

The decrease in selling and administrative expenses was primarily due to lower professional fees as a result of the settlement of the Extended Stay litigation.

The increases in our provisions for loss sharing and credit losses (“CECL provisions”) were primarily due to the impact of a continued decline in the macroeconomic outlook for commercial real estate including specifically identified impaired assets.

Loss on Extinguishment of Debt

The loss on extinguishment of debt in 2023 reflects deferred financing fees recognized in connection with the unwind of CLO 12. The loss on extinguishment of debt in 2022 represents deferred financing fees recognized in connection with the repurchase of our 4.75% convertible notes.

Income from Equity Affiliates

Income from equity affiliates in 2023 primarily reflects $3.5 million received from an equity participation interest on a property that was sold, partially offset by an aggregate loss of $2.7 million from our ongoing equity investments, while income in 2022 primarily reflects a $5.0 million distribution received from our Lexford joint venture.

(Provision for) Benefit from Income Taxes

In the three months ended September 30, 2023, we recorded a tax provision of $5.9 million, which consisted of a current tax provision of $8.3 million and a deferred tax benefit of $2.4 million. In the three months ended September 30, 2022, we recorded a tax benefit of $0.4 million, which consisted of a deferred tax benefit of $5.4 million and a current tax provision of $5.0 million.

Net Income Attributable to Noncontrolling Interest

The noncontrolling interest relates to the outstanding OP Units (see Note 15). There were 16,293,589 OP Units outstanding at both September 30, 2023 and 2022, which represented 8.0% and 8.7% of our outstanding stock at September 30, 2023 and 2022, respectively.

54

Comparison of Results of Operations for the Nine Months Ended September 30, 2023 and 2022

The following table provides our consolidated operating results ($ in thousands):

	Nine Months Ended September 30,				Increase / (Decrease)
	2023		2022		Amount		Percent
Interest income	$	1,000,159	$	627,804	$	372,355	59	%
Interest expense	675,749		350,079		325,670		93	%
Net interest income	324,410		277,725		46,685		17	%
Other revenue:
Gain on sales, including fee-based services, net	55,795		32,526		23,269		72	%
Mortgage servicing rights	48,769		52,287		(3,518)		(7)	%
Servicing revenue, net	97,376		64,513		32,863		51	%
Property operating income	4,261		1,031		3,230		nm
Gain (loss) on derivative instruments, net	(3,582)		10,083		(13,665)		nm
Other income (loss), net	5,099		(16,061)		21,160		nm
Total other revenue	207,718		144,379		63,339		44	%
Other expenses:
Employee compensation and benefits	123,518		119,736		3,782		3	%
Selling and administrative	38,574		40,960		(2,386)		(6)	%
Property operating expenses	4,227		1,443		2,784		193	%
Depreciation and amortization	7,297		6,092		1,205		20	%
Provision for loss sharing (net of recoveries)	12,528		(2,199)		14,727		nm
Provision for credit losses (net of recoveries)	55,047		9,700		45,347		nm
Total other expenses	241,191		175,732		65,459		37	%
Income before extinguishment of debt, income from equity affiliates and income taxes	290,937		246,372		44,565		18	%
Loss on extinguishment of debt	(1,561)		(4,612)		3,051		(66)	%
Income from equity affiliates	20,694		18,507		2,187		12	%
Provision for income taxes	(19,436)		(13,166)		(6,270)		48	%
Net income	290,634		247,101		43,533		18	%
Preferred stock dividends	31,027		30,612		415		1	%
Net income attributable to noncontrolling interest	21,200		19,811		1,389		7	%
Net income attributable to common stockholders	$	238,407	$	196,678	$	41,729	21	%

________________________

nm — not meaningful

55

The following table presents the average balance of our Structured Business interest-earning assets and interest-bearing liabilities, associated interest income (expense) and the corresponding weighted average yields ($ in thousands):

	Nine Months Ended September 30,
	2023						2022
	Average Carrying Value (1)		Interest Income / Expense		W/A Yield / Financing Cost (2)		Average Carrying Value (1)		Interest Income / Expense		W/A Yield / Financing Cost (2)
Structured Business interest-earning assets:
Bridge loans	$	13,393,723	$	912,733	9.11	%	$	13,834,249	$	568,667	5.50	%
Mezzanine / junior participation loans	220,858		17,047		10.32	%	205,684		14,781		9.61	%
Preferred equity investments	91,542		4,349		6.35	%	149,456		8,393		7.51	%
Other	24,804		3,158		17.02	%	36,354		4,654		17.12	%
Core interest-earning assets	13,730,927		937,287		9.13	%	14,225,743		596,495		5.61	%
Cash equivalents	880,615		25,014		3.80	%	848,115		1,352		0.21	%
Total interest-earning assets	$	14,611,542	$	962,301	8.81	%	$	15,073,858	$	597,847	5.30	%
Structured Business interest-bearing liabilities:
CLO	$	7,183,257	$	370,096	6.89	%	$	7,373,412	$	158,072	2.87	%
Credit and repurchase facilities	3,254,448		189,400		7.78	%	3,983,674		110,379		3.70	%
Unsecured debt	1,667,912		77,309		6.20	%	1,578,459		65,478		5.55	%
Q Series securitization	233,188		12,683		7.27	%	—		—		—
Trust preferred	154,336		9,368		8.12	%	154,336		4,763		4.13	%
Total interest-bearing liabilities	$	12,493,141	658,856		7.05	%	$	13,089,881	338,692		3.46	%
Net interest income			$	303,445					$	259,155

________________________

(1)Based on UPB for loans, amortized cost for securities and principal amount of debt.

(2)Weighted average yield calculated based on annualized interest income or expense divided by average carrying value.

Net Interest Income

The increase in interest income was mainly due to a $364.5 million increase from our Structured Business, primarily due to a significant increase in the average yield on core interest-earning assets, as a result of increases in benchmark interest rates.

The increase in interest expense was mainly due to a $320.2 million increase from our Structured Business, primarily due to a significant increase in the average cost of our interest-bearing liabilities, mainly from increases in benchmark index rates.

Agency Business Revenue

The increase in gain on sales, including fee-based services, net was primarily due to an 15% increase in the sales margin from 1.34% (which includes gains recognized on Swaps) to 1.54%. The increase in the sales margin was primarily driven by higher margins received on Fannie Mae and Private Label loan sales.

The decrease in income from MSRs was primarily due to a 12% decrease in the MSR rate from 1.44% to 1.27%, partially offset by a 6% increase in loan commitment volume ($221.1 million). The decrease in the MSR rate was primarily due to a reduction in servicing rates on newer loans.

The increase in servicing revenue, net was primarily due to an increase in earnings on escrow balances as a result of increases in benchmark index rates, partially offset by less prepayment penalties received.

Other Income (Loss)

The gain (loss) on derivative instruments in both 2023 and 2022 were related to changes in the fair values of our forward sale commitments and Swaps held by our Agency Business.

Other income (loss), net in 2023 primarily reflects $3.4 million of loan origination fees from our Structured Business and a $1.7 million mark-to-market recovery from the sale of Private Label loans in our Agency Business, while 2022 primarily reflects an $12.2 million

56

unrealized impairment loss recorded on certain loans held-for-sale in our Agency Business and $11.2 million of losses recognized in the second quarter of 2022 related to sales of bridge loans in our Structured Business.

Other Expenses

The increase in employee compensation and benefits expense was primarily due to increases in headcount.

The decrease in selling and administrative expenses was primarily due to lower professional fees as a result of the settlement of the Extended Stay litigation.

The increases in our CECL provisions were primarily due to the impact of a continued decline in the macroeconomic outlook for commercial real estate including specifically identified impaired assets.

Loss on Extinguishment of Debt

The loss on extinguishment of debt in both 2023 and 2022 reflects deferred financing fees recognized in connection with the unwind of CLOs, along with the 2022 repurchase of our 4.75% convertible notes.

Income from Equity Affiliates

Income from equity affiliates in 2023 primarily reflects $14.5 million received from equity participation interests on properties that were sold and $7.2 million in distributions received from our Lexford joint venture, while income in 2022 primarily reflects an $11.0 million distribution received from our Lexford joint venture, income from our investment in a residential mortgage banking business of $6.4 million and a $2.6 million equity participation interest on a property that was sold.

Provision for Income Taxes

In the nine months ended September 30, 2023, we recorded a tax provision of $19.4 million, which consisted of a current tax provision of $26.0 million and a deferred tax benefit of $6.6 million. In the nine months ended September 30, 2022, we recorded a tax provision of $13.2 million, which consisted of a current tax provision of $21.0 million and a deferred tax benefit of $7.8 million.

Net Income Attributable to Noncontrolling Interest

The noncontrolling interest relates to the outstanding OP Units (see Note 15). There were 16,293,589 OP Units outstanding at both September 30, 2023 and 2022, which represented 8.0% and 8.7% of our outstanding stock at September 30, 2023 and 2022, respectively.

Liquidity and Capital Resources

Sources of Liquidity. Liquidity is a measure of our ability to meet our potential cash requirements, including ongoing commitments to repay borrowings, satisfaction of collateral requirements under the Fannie Mae DUS risk-sharing agreement and, as an approved designated seller/servicer of Freddie Mac’s SBL program, operational liquidity requirements of the GSE agencies, fund new loans and investments, fund operating costs and distributions to our stockholders, as well as other general business needs. Our primary sources of funds for liquidity consist of proceeds from equity and debt offerings, proceeds from CLOs and securitizations, debt facilities and cash flows from operations. We closely monitor our liquidity position and believe our existing sources of funds and access to additional liquidity will be adequate to meet our liquidity needs.

The ongoing adverse economic and market conditions, including inflation, rising interest rates, bank failures and geopolitical uncertainty, continues to cause significant disruptions and liquidity constraints in many market segments, including the financial services, real estate and credit markets. These conditions have created, and may continue to create, a dislocation in capital markets and a continual reduction of available liquidity. Instability in the banking sector, such as the recent bank failures and consolidations, further contributed to the tightening liquidity conditions in the equity and capital markets and has affected the availability and increased the cost of capital. The increased cost of credit, or degradation in debt financing terms, may impact our ability to identify and execute investments on attractive terms, or at all. If our financing sources, borrowers and their tenants continue to be impacted by these adverse economic and market conditions, or by the other risks disclosed in our filings with the SEC, it would have a material adverse effect on our liquidity and capital resources.

As described in Note 9, certain of our repurchase facilities include margin call provisions associated with changes in interest spreads which are designed to limit the lenders credit exposure. If we experience significant decreases in the value of the properties serving as collateral under these repurchase agreements, which is set by the lenders based on current market conditions, the lenders have the right to require us to repay all, or a portion, of the funds advanced, or provide additional collateral. While we expect to extend or renew all of our facilities as they mature, we cannot provide assurance that they will be extended or renewed on as favorable terms.

We had $11.86 billion in total structured debt outstanding at September 30, 2023. Of this total, $8.82 billion, or 74%, does not contain mark-to-market provisions and is comprised of non-recourse securitized debt, senior unsecured debt and junior subordinated notes, all of

57

which have maturity dates in 2024, or later. The remaining $3.04 billion of debt is in credit and repurchase facilities with several different banks that we have long-standing relationships with. At September 30, 2023, we had $1.72 billion of debt from credit and repurchase facilities that were subject to margin calls related to changes in interest spreads.

At October 24, 2023, we had approximately $1.00 billion in cash and approximately $500.0 million of replenishable cash available under our CLO vehicles, as well as other liquidity sources. In addition to our ability to extend our credit and repurchase facilities and raise funds from equity and debt offerings, we also have a $29.94 billion agency servicing portfolio at September 30, 2023, which is mostly prepayment protected and generates approximately $119 million per year in recurring gross cash flow.

To maintain our status as a REIT under the Internal Revenue Code, we must distribute annually at least 90% of our REIT-taxable income. These distribution requirements limit our ability to retain earnings and thereby replenish or increase capital for operations. However, we believe that our capital resources and access to financing will provide us with financial flexibility and market responsiveness at levels sufficient to meet current and anticipated capital and liquidity requirements.

Cash Flows. Cash flows provided by operating activities totaled $158.5 million during the nine months ended September 30, 2023 and consisted primarily of net income (adjusted for the increase in CECL reserves of $67.6 million) of $358.2 million, partially offset by a $134.2 million increase in funds from payoffs due from our affiliated servicing operations and a $45.3 million increase in other assets, primarily due to an increase in unsecured loan fundings.

Cash flows provided by investing activities totaled $1.42 billion during the nine months ended September 30, 2023. Loan and investment activity (originations and payoffs/paydowns) comprise the majority of our investing activities. Loan payoffs and paydowns from our Structured Business totaling $2.54 billion, net of originations of $1.06 billion, resulted in net cash inflows of $1.48 billion.

Cash flows used in financing activities totaled $1.51 billion during the nine months ended September 30, 2023 and consisted primarily of $856.9 million of redemptions of CLO 13 and 12, net cash outflows of $457.7 million from debt facility activities (facility paydowns were greater than loan originations) and $282.0 million of distributions to our stockholders and OP Unit holders, partially offset by $193.7 million of proceeds from the issuance of common stock.

Agency Business Requirements. The Agency Business is subject to supervision by certain regulatory agencies. Among other things, these agencies require us to meet certain minimum net worth, operational liquidity and restricted liquidity collateral requirements, purchase and loss obligations and compliance with reporting requirements. Our adjusted net worth and operational liquidity exceeded the agencies’ requirements at September 30, 2023. Our restricted liquidity and purchase and loss obligations were satisfied with letters of credit totaling $69.0 million and cash. See Note 13 for details about our performance regarding these requirements.

We also enter into contractual commitments with borrowers providing rate lock commitments while simultaneously entering into forward sale commitments with investors. These commitments are outstanding for short periods of time (generally less than 60 days) and are described in Note 11.

Debt Facilities. We maintain various forms of short-term and long-term financing arrangements. Borrowings underlying these arrangements are primarily secured by a significant amount of our loans and investments and substantially all our loans held-for-sale. The following is a summary of our debt facilities ($ in thousands):

Debt Instruments	September 30, 2023
	Commitment		UPB (1)		Available		Maturity Dates (2)
Structured Business
Credit and repurchase facilities	$	6,629,612	$	3,043,406	$	3,586,206	2023 - 2026
Securitized debt (3)	7,029,202		7,029,202		—		2023 - 2027
Senior unsecured notes	1,345,000		1,345,000		—		2024 - 2028
Convertible senior unsecured notes	287,500		287,500		—		2025
Junior subordinated notes	154,336		154,336		—		2034 - 2037
Structured Business total	15,445,650		11,859,444		3,586,206
Agency Business
Credit and repurchase facilities (4)	2,100,531		355,045		1,745,486		2023 - 2025
Consolidated total	$	17,546,181	$	12,214,489	$	5,331,692

________________________

(1)Excludes the impact of deferred financing costs.

(2)See Note 13 for a breakdown of debt maturities by year.

(3)Maturity dates represent the weighted average remaining maturity based on the underlying collateral at September 30, 2023.

58

(4)The ASAP agreement we have with Fannie Mae has no expiration date.

We utilize our credit and repurchase facilities primarily to finance our loan originations on a short-term basis prior to loan securitizations, including through CLOs. The timing, size and frequency of our securitizations impact the balances of these borrowings and produce some fluctuations. The following table provides additional information regarding the balances of our borrowings (in thousands):

Quarter Ended	Quarterly Average UPB		End of Period UPB		Maximum UPB at Any Month-End
September 30, 2023	$	3,432,725	$	3,398,451	$	3,463,825
June 30, 2023	3,565,377		3,588,538		3,677,755
March 31, 2023	3,691,191		3,662,756		3,696,760
December 31, 2022	4,441,774		3,856,009		4,403,368
September 30, 2022	4,534,744		4,642,911		4,642,911

Our debt facilities, including their restrictive covenants, are described in Note 9.

Off-Balance Sheet Arrangements. At September 30, 2023, we had no off-balance sheet arrangements.

Inflation. The Federal Reserve has raised interest rates throughout 2022 and during the first nine months of 2023 to combat inflation and restore price stability. As inflation begins to cool, it is possible that the rate hikes from the Federal Reserve will slow, or pause during the remainder of 2023. Currently, rising interest rates will positively impact our net interest income since our structured loan portfolio exceeds our corresponding debt balances and the vast majority of our loan portfolio is floating-rate based on SOFR. In addition, a greater portion of our debt is fixed-rate (convertible and senior unsecured notes), as compared to our structured loan portfolio, and will not reset as interest rates rise. Therefore, increases in interest income due to rising interest rates is likely to be greater than the corresponding increase in interest expense on our variable rate debt. See “Quantitative and Qualitative Disclosures about Market Risk” below for additional details.

Contractual Obligations. During the nine months ended September 30, 2023, the following significant changes were made to our contractual obligations disclosed in our 2022 Annual Report:

•unwound CLO 13 and 12 repaying $842.1 million of outstanding notes;

•issued $95.0 million of 7.75% senior unsecured notes and used $70.8 million of the proceeds to repurchase our 8.00% senior unsecured notes;

•redeemed the remaining $78.9 million of our 5.625% senior unsecured notes; and

•modified existing debt facilities.

Refer to Note 13 for a description of our debt maturities by year and unfunded commitments at September 30, 2023.

Derivative Financial Instruments

We enter into derivative financial instruments in the normal course of business to manage the potential loss exposure caused by fluctuations of interest rates. See Note 11 for details.

Critical Accounting Policies

Please refer to Note 2 of the Notes to Consolidated Financial Statements in our 2022 Annual Report for a discussion of our critical accounting policies. During the nine months ended September 30, 2023, there were no material changes to these policies.

Non-GAAP Financial Measures

Distributable Earnings. We are presenting distributable earnings because we believe it is an important supplemental measure of our operating performance and is useful to investors, analysts and other parties in the evaluation of REITs and their ability to provide dividends to stockholders. Dividends are one of the principal reasons investors invest in REITs. To maintain REIT status, REITs are required to distribute at least 90% of their REIT-taxable income. We consider distributable earnings in determining our quarterly dividend and believe that, over time, distributable earnings is a useful indicator of our dividends per share.

We define distributable earnings as net income (loss) attributable to common stockholders computed in accordance with GAAP, adjusted for accounting items such as depreciation and amortization (adjusted for unconsolidated joint ventures), non-cash stock-based compensation expense, income from MSRs, amortization and write-offs of MSRs, gains/losses on derivative instruments primarily associated with Private Label loans not yet sold and securitized, changes in fair value of GSE-related derivatives that temporarily flow through earnings (net of any tax impact), deferred tax provision (benefit), CECL provisions for credit losses (adjusted for realized losses as described below), and gains/losses on the receipt of real estate from the settlement of loans (prior to the sale of the real estate). We also

59

add back one-time charges such as acquisition costs and one-time gains/losses on the early extinguishment of debt and redemption of preferred stock.

We reduce distributable earnings for realized losses in the period we determine that a loan is deemed nonrecoverable in whole or in part. Loans are deemed nonrecoverable upon the earlier of: (1) when the loan receivable is settled (i.e., when the loan is repaid, or in the case of foreclosure, when the underlying asset is sold); or (2) when we determine that it is nearly certain that all amounts due will not be collected. The realized loss amount is equal to the difference between the cash received, or expected to be received, and the book value of the asset.

Distributable earnings is not intended to be an indication of our cash flows from operating activities (determined in accordance with GAAP) or a measure of our liquidity, nor is it entirely indicative of funding our cash needs, including our ability to make cash distributions. Our calculation of distributable earnings may be different from the calculations used by other companies and, therefore, comparability may be limited.

Distributable earnings are as follows ($ in thousands, except share and per share data):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Net income attributable to common stockholders	$	77,924	$	62,710	$	238,407	$	196,678
Adjustments:
Net income attributable to noncontrolling interest	6,789		6,002		21,200		19,811
Income from mortgage servicing rights	(14,109)		(19,408)		(48,769)		(52,287)
Deferred tax benefit	(2,433)		(5,407)		(6,630)		(7,833)
Amortization and write-offs of MSRs	18,757		26,555		58,684		81,850
Depreciation and amortization	3,957		2,666		12,310		7,846
Loss on extinguishment of debt	314		3,262		1,561		4,612
Provision for credit losses, net	16,922		2,708		57,437		10,254
Gain on derivative instruments, net	1,002		22,925		2,036		18,472
Stock-based compensation	3,047		3,085		12,141		12,327
Distributable earnings (1)	$	112,170	$	105,098	$	348,377	$	291,730
Diluted weighted average shares outstanding - GAAP (1)	221,328,818		205,865,016		217,457,399		195,529,340
Less: Convertible notes dilution	(17,312,382)		(18,815,399)		(17,271,419)		(16,355,146)
Diluted weighted average shares outstanding - distributable earnings (1)	204,016,436		187,049,617		200,185,980		179,174,194
Diluted distributable earnings per share (1)	$	0.55	$	0.56	$	1.74	$	1.63

________________________

(1)Amounts are attributable to common stockholders and OP Unit holders. The OP Units are redeemable for cash, or at our option for shares of our common stock on a one-for-one basis.

Item 3.    Quantitative and Qualitative Disclosures About Market Risk

We disclosed a quantitative and qualitative analysis regarding market risk in Item 7A of our 2022 Annual Report. That information is supplemented by the information included above in Item 2 of this report. Other than the developments described thereunder, there have been no material changes in our exposure to market risk since December 31, 2022.

60

The following table projects the potential impact on interest (in thousands) for a 12-month period, assuming a hypothetical instantaneous increase or decrease of both 50 and 100 basis points in SOFR or other applicable index rate (collectively referred to as the “Index Rates” below).

	Assets (Liabilities) Subject to Interest Rate Sensitivity (1)		50 Basis Point Increase		100 Basis Point Increase		50 Basis Point Decrease		100 Basis Point Decrease
Interest income from loans and investments	$	13,122,395	$	60,974	$	121,949	$	(60,292)	$	(119,845)
Interest expense from debt obligations	(11,859,444)		51,161		102,322		(51,161)		(102,322)
Impact to net interest income (2)			$	9,813	$	19,627	$	(9,131)	$	(17,523)

________________________

(1)Represents the UPB of our loan portfolio and the principal balance of our debt.

(2)The impact of hypothetical rate changes to net interest income are further benefited by interest income earned on our cash, restricted cash and escrow balances. At September 30, 2023, we had approximately $2.9 billion of cash, restricted cash and escrows, which is earning interest at a weighted average blended rate of approximately 5.0%, or approximately $145.0 million annually. Interest income earned on escrows is included as a component of servicing revenue, net and interest income earned on our cash and restricted cash is included as a component of interest income in the consolidated statements of income. The interest earned on our cash, restricted cash and escrows is based on an average daily balance and may be different from the end of period balance. Additionally, the interest rates on these balances are not indexed to an Index Rate and are negotiated periodically with each corresponding bank, therefore, the interest rates may change frequently and may not necessarily change in conjunction with changes in Index Rates.

We enter into interest rate swaps to hedge our exposure to changes in interest rates inherent in (1) our held-for-sale Agency Business Private Label loans from the time the loans are rate locked until sale and securitization, and (2) our Agency Business SFR – fixed rate loans from the time the loans are originated until the time they can be financed with match term fixed rate securitized debt. Our interest rate swaps are tied to the five-year and ten-year swap rates and hedge our exposure to Private Label loans, until the time they are securitized, and changes in the fair value of our held-for-sale Agency Business SFR – fixed rate loans. A 50 basis point and a 100 basis point increase to the five-year and ten-year swap rates on our interest rate swaps held at September 30, 2023 would have resulted in a gain of $0.8 million and $1.2 million, respectively, in the nine months ended September 30, 2023, while a 50 basis point and a 100 basis point decrease in the rates would have resulted in a gain of $0.1 million and a loss of $0.2 million, respectively.

Our Agency Business originates, sells and services a range of multifamily finance products with Fannie Mae, Freddie Mac and HUD. Our loans held-for-sale to these agencies are not currently exposed to interest rate risk during the loan commitment, closing and delivery process. The sale or placement of each loan to an investor is negotiated prior to closing on the loan with the borrower, and the sale or placement is generally effectuated within 60 days of closing. The coupon rate for the loan is set after we establish the interest rate with the investor.

In addition, the fair value of our MSRs is subject to market risk since a significant driver of the fair value of these assets is the discount rates. A 100 basis point increase in the weighted average discount rate would decrease the fair value of our MSRs by $17.6 million at September 30, 2023, while a 100 basis point decrease would increase the fair value by $18.6 million.

Item 4.    Controls and Procedures

Management, with the participation of our chief executive officer and chief financial officer, has evaluated the effectiveness of our disclosure controls and procedures at September 30, 2023. Based on this evaluation, our chief executive officer and chief financial officer have concluded that our disclosure controls and procedures were effective at September 30, 2023.

There were no changes in our internal control over financial reporting during the quarter ended September 30, 2023 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

PART II.    OTHER INFORMATION

Item 1.    Legal Proceedings

We are not involved in any material litigation nor, to our knowledge, is any material litigation threatened against us.

Item 1A.    Risk Factors

There have been no material changes to the risk factors set forth in Item 1A of our 2022 Annual Report.

61

Item 2.    Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities

In March 2023, the Board of Directors authorized a share repurchase program providing for the repurchase of up to $50.0 million of our outstanding common stock. The repurchase of our common stock may be made from time to time in the open market, through privately negotiated transactions, or otherwise in compliance with Rule 10b-18 and Rule 10b5-1 under the Securities Exchange Act of 1934, based on our stock price, general market conditions, applicable legal requirements and other factors. The program may be discontinued or modified at any time.

We made no purchases under this plan during the three months ended September 30, 2023.

62

Item 6.    Exhibits

		Incorporated by Reference
Exhibit #	Description	Form	Exhibit #	Filing Date
3.1	Articles of Incorporation of Arbor Realty Trust, Inc.	S-11	3.1	11/13/03
3.2	Articles of Amendment to Articles of Incorporation of Arbor Realty Trust, Inc.	10-Q	3.2	08/07/07
3.3	Amended and Restated Bylaws of Arbor Realty Trust, Inc.	8-K	3.1	12/01/20
31.1	Certification of Chief Executive Officer pursuant to Exchange Act Rule 13a-14
31.2	Certification of Chief Financial Officer pursuant to Exchange Act Rule 13a-14
32	Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101	Financial statements from the Quarterly Report on Form 10-Q of Arbor Realty Trust, Inc. for the quarter ended September 30, 2023, filed on October 27, 2023, formatted in Inline Extensible Business Reporting Language (“XBRL”): (1) the Consolidated Balance Sheets, (2) the Consolidated Statements of Income, (3) the Consolidated Statements of Changes in Equity, (4) the Consolidated Statements of Cash Flows and (5) the Notes to Consolidated Financial Statements.
104	Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101)

63

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	ARBOR REALTY TRUST, INC.
Date: October 27, 2023	By:	/s/ Ivan Kaufman
		Ivan Kaufman
		Chief Executive Officer
Date: October 27, 2023	By:	/s/ Paul Elenio
		Paul Elenio
		Chief Financial Officer

64

EX-31.1

EXHIBIT 31.1

Certification of Chief Executive Officer

I, Ivan Kaufman, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Arbor Realty Trust, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	October 27, 2023	By:	/s/ Ivan Kaufman
			Ivan Kaufman
			Chief Executive Officer

EX-31.2

EXHIBIT 31.2

Certification of Chief Financial Officer

I, Paul Elenio, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Arbor Realty Trust, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	October 27, 2023	By:	/s/ Paul Elenio
			Paul Elenio
			Chief Financial Officer

EX-32

EXHIBIT 32

Certifications of Chief Executive Officer and Chief Financial Officer Pursuant to

18 U.S.C. Section 1350,

as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-Q of Arbor Realty Trust, Inc. (the “Company”) for the quarter ended September 30, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers of the Company, hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of our knowledge:

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	October 27, 2023	By:	/s/ Ivan Kaufman
			Ivan Kaufman
			Chief Executive Officer
Date:	October 27, 2023	By:	/s/ Paul Elenio
			Paul Elenio
			Chief Financial Officer

This certification is being furnished and shall not be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

A signed original of this certification required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Cover Page - shares	9 Months Ended
	Sep. 30, 2023	Oct. 20, 2023
Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2023
Document Transition Report	false
Entity File Number	001-32136
Entity Registrant Name	Arbor Realty Trust, Inc.
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	20-0057959
Entity Address, Address Line One	333 Earle Ovington Boulevard
Entity Address, Address Line Two	Suite 900
Entity Address, City or Town	Uniondale
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	11553
City Area Code	516
Local Phone Number	506-4200
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		188,501,642
Entity Central Index Key	0001253986
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q3
Amendment Flag	false
Common stock
Entity Information [Line Items]
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	ABR
Security Exchange Name	NYSE
Preferred Stock, 6.375% Series D Cumulative Redeemable, par value $0.01 per share
Entity Information [Line Items]
Title of 12(b) Security	Preferred Stock, 6.375% Series D CumulativeRedeemable, par value $0.01 per share
Trading Symbol	ABR-PD
Security Exchange Name	NYSE
Preferred Stock, 6.25% Series E Cumulative Redeemable, par value $0.01 per share
Entity Information [Line Items]
Title of 12(b) Security	Preferred Stock, 6.25% Series E CumulativeRedeemable, par value $0.01 per share
Trading Symbol	ABR-PE
Security Exchange Name	NYSE
Preferred Stock, 6.25% Series F Fixed-to-Floating Rate Cumulative Redeemable, par value $0.01 per share
Entity Information [Line Items]
Title of 12(b) Security	Preferred Stock, 6.25% Series F Fixed-to-Floating Rate Cumulative Redeemable, par value $0.01 per share
Trading Symbol	ABR-PF
Security Exchange Name	NYSE

XML

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Assets:
Cash and cash equivalents	$ 895,298	$ 534,357
Restricted cash	419,158	713,808
Loans and investments, net (allowance for credit losses of $184,069 and $132,559)	12,892,796	14,254,674
Loans held-for-sale, net	364,320	354,070
Capitalized mortgage servicing rights, net	392,203	401,471
Securities held-to-maturity, net (allowance for credit losses of $5,943 and $3,153)	155,172	156,547
Investments in equity affiliates	62,795	79,130
Goodwill and other intangible assets	92,551	96,069
Other assets	416,741	371,440
Total assets	15,902,689	17,038,985
Liabilities:
Credit and repurchase facilities	3,391,441	3,841,814
Securitized debt	7,004,634	7,849,270
Senior unsecured notes	1,332,926	1,385,994
Convertible senior unsecured notes	282,428	280,356
Junior subordinated notes to subsidiary trust issuing preferred securities	143,695	143,128
Due to borrowers	114,660	61,237
Allowance for loss-sharing obligations	69,261	57,168
Other liabilities	320,973	335,789
Total liabilities	12,662,188	13,967,106
Commitments and contingencies (Note 13)
Arbor Realty Trust, Inc. stockholders' equity:
Preferred stock, cumulative, redeemable, $0.01 par value: 100,000,000 shares authorized, shares issued and outstanding by period: Special voting preferred shares - 16,293,589 shares, 6.375% Series D - 9,200,000 shares, 6.25% Series E - 5,750,000 shares, 6.25% Series F - 11,342,000 shares	633,684	633,684
Common stock, $0.01 par value: 500,000,000 shares authorized - 188,501,642 and 178,230,522 shares issued and outstanding	1,885	1,782
Additional paid-in capital	2,364,395	2,204,481
Retained earnings	104,821	97,049
Total Arbor Realty Trust, Inc. stockholders' equity	3,104,785	2,936,996
Noncontrolling interest	135,716	134,883
Total equity	3,240,501	3,071,879
Total liabilities and equity	15,902,689	17,038,985
Related Party
Assets:
Due from related party	211,655	77,419
Liabilities:
Due to related party	$ 2,170	$ 12,350

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
Loans and investments, allowance for credit losses	$ 184,069	$ 132,559
Securities held-to-maturity, allowance for credit losses	$ 5,943	$ 3,153
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	100,000,000	100,000,000
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	500,000,000	500,000,000
Common stock, shares issued (in shares)	188,501,642	178,230,522
Common stock, shares outstanding (in shares)	188,501,642	178,230,522
Assets of consolidated VIEs	$ 15,902,689	$ 17,038,985
Liabilities of consolidated VIEs	12,662,188	13,967,106
Consolidated VIEs
Assets of consolidated VIEs	8,689,298	9,785,261
Liabilities of consolidated VIEs	$ 7,027,893	$ 7,876,024
Special voting preferred shares
Preferred stock, shares issued (in shares)	16,293,589	16,293,589
Series D preferred stock
Preferred stock, shares issued (in shares)	9,200,000	9,200,000
Preferred stock, dividend rate (as a percent)	6.375%	6.375%
Series E preferred stock
Preferred stock, shares issued (in shares)	5,750,000	5,750,000
Preferred stock, dividend rate (as a percent)	6.25%	6.25%
Series F preferred stock
Preferred stock, shares issued (in shares)	11,342,000	11,342,000
Preferred stock, dividend rate (as a percent)	6.25%	6.25%

XML

CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Income Statement [Abstract]
Interest income	$ 336,474	$ 259,778	$ 1,000,159	$ 627,804
Interest expense	229,180	160,452	675,749	350,079
Net interest income	107,294	99,326	324,410	277,725
Other revenue:
Gain on sales, including fee-based services, net	18,619	14,360	55,795	32,526
Mortgage servicing rights	14,109	19,408	48,769	52,287
Servicing revenue, net	35,463	22,744	97,376	64,513
Property operating income	1,450	445	4,261	1,031
Gain (loss) on derivative instruments, net	(421)	(15,909)	(3,582)	10,083
Other income (loss), net	173	(6,014)	5,099	(16,061)
Total other revenue	69,393	35,034	207,718	144,379
Other expenses:
Employee compensation and benefits	39,810	38,811	123,518	119,736
Selling and administrative	12,367	13,225	38,574	40,960
Property operating expenses	1,479	366	4,227	1,443
Depreciation and amortization	2,286	2,078	7,297	6,092
Provision for loss sharing (net of recoveries)	1,679	412	12,528	(2,199)
Provision for credit losses (net of recoveries)	18,652	2,274	55,047	9,700
Total other expenses	76,273	57,166	241,191	175,732
Income before extinguishment of debt, income from equity affiliates and income taxes	100,414	77,194	290,937	246,372
Loss on extinguishment of debt	(314)	(3,262)	(1,561)	(4,612)
Income from equity affiliates	809	4,748	20,694	18,507
(Provision for) benefit from income taxes	(5,854)	374	(19,436)	(13,166)
Net income	95,055	79,054	290,634	247,101
Preferred stock dividends	10,342	10,342	31,027	30,612
Net income attributable to noncontrolling interest	6,789	6,002	21,200	19,811
Net income attributable to common stockholders	$ 77,924	$ 62,710	$ 238,407	$ 196,678
Earnings per common share
Basic earnings per common share (in dollars per share)	$ 0.42	$ 0.37	$ 1.30	$ 1.21
Diluted earnings per common share (in dollars per share)	$ 0.41	$ 0.36	$ 1.28	$ 1.18
Weighted average shares outstanding:
Basic (in shares)	187,023,395	170,227,553	183,340,149	162,292,235
Diluted (in shares)	221,328,818	205,865,016	217,457,399	195,529,340
Dividends declared per common share (in dollars per share)	$ 0.43	$ 0.39	$ 1.25	$ 1.14

XML

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands	Total	Series F preferred stock	Total Arbor Realty Trust, Inc. Stockholders’ Equity	Total Arbor Realty Trust, Inc. Stockholders’ Equity Series F preferred stock	Preferred Stock	Preferred Stock Series F preferred stock	Common stock	Additional Paid-in Capital	Additional Paid-in Capital Series F preferred stock	Retained Earnings	Noncontrolling Interest
Balance beginning (in shares) at Dec. 31, 2021					39,325,095		151,362,181
Balance beginning at Dec. 31, 2021	$ 2,547,537		$ 2,415,050		$ 556,163		$ 1,514	$ 1,789,229		$ 68,144	$ 132,487
Increase (Decrease) in Stockholders' Equity
Issuance of common stock and Series F preferred stock (in shares)						3,292,000	19,625,788
Issuance of common stock and Series F preferred stock	312,766	$ 77,392	312,766	$ 77,392		$ 77,522	$ 196	312,570	$ (130)
Stock-based compensation, net (in shares)							(535,839)
Stock-based compensation, net	4,245		4,245				$ 5	4,240
Distributions - common stock	(185,285)		(185,285)							(185,285)
Distributions - preferred stock	(30,618)		(30,618)							(30,618)
Distributions - noncontrolling interest	(18,586)										(18,586)
Redemption - operating partnership units (in shares)					(31,506)
Redemption - operating partnership units	(546)		(1)		$ (1)						(545)
Net income	247,101		227,290							227,290	19,811
Balance ending (in shares) at Sep. 30, 2022					42,585,589		171,523,808
Balance ending at Sep. 30, 2022	2,954,006		2,820,839		$ 633,684		$ 1,715	2,105,909		79,531	133,167
Balance beginning (in shares) at Jun. 30, 2022					42,585,589		168,454,805
Balance beginning at Jun. 30, 2022	2,912,996		2,779,477		$ 633,684		$ 1,685	2,060,837		83,271	133,519
Increase (Decrease) in Stockholders' Equity
Issuance of common stock and Series F preferred stock (in shares)							3,170,688
Issuance of common stock and Series F preferred stock	44,522		44,522				$ 31	44,491
Stock-based compensation, net (in shares)							(101,685)
Stock-based compensation, net	580		580				$ (1)	581
Distributions - common stock	(66,447)		(66,447)							(66,447)
Distributions - preferred stock	(10,345)		(10,345)							(10,345)
Distributions - noncontrolling interest	(6,354)										(6,354)
Net income	79,054		73,052							73,052	6,002
Balance ending (in shares) at Sep. 30, 2022					42,585,589		171,523,808
Balance ending at Sep. 30, 2022	2,954,006		2,820,839		$ 633,684		$ 1,715	2,105,909		79,531	133,167
Balance beginning (in shares) at Dec. 31, 2022					42,585,589		178,230,522
Balance beginning at Dec. 31, 2022	3,071,879		2,936,996		$ 633,684		$ 1,782	2,204,481		97,049	134,883
Increase (Decrease) in Stockholders' Equity
Issuance of common stock and Series F preferred stock (in shares)							13,113,296
Issuance of common stock and Series F preferred stock	193,660		193,660				$ 130	193,530
Repurchase of common stock (in shares)							(3,545,604)
Repurchase - common stock	(37,432)		(37,432)				$ (36)	(37,396)
Stock-based compensation, net (in shares)							(703,428)
Stock-based compensation, net	3,789		3,789				$ 9	3,780
Distributions - common stock	(230,632)		(230,632)							(230,632)
Distributions - preferred stock	(31,030)		(31,030)							(31,030)
Distributions - noncontrolling interest	(20,367)										(20,367)
Net income	290,634		269,434							269,434	21,200
Balance ending (in shares) at Sep. 30, 2023					42,585,589		188,501,642
Balance ending at Sep. 30, 2023	3,240,501		3,104,785		$ 633,684		$ 1,885	2,364,395		104,821	135,716
Balance beginning (in shares) at Jun. 30, 2023					42,585,589		183,067,388
Balance beginning at Jun. 30, 2023	3,159,641		3,023,708		$ 633,684		$ 1,831	2,280,632		107,561	135,933
Increase (Decrease) in Stockholders' Equity
Issuance of common stock and Series F preferred stock (in shares)							5,576,496
Issuance of common stock and Series F preferred stock	83,992		83,992				$ 55	83,937
Stock-based compensation, net (in shares)							(142,242)
Stock-based compensation, net	(175)		(175)				$ (1)	(174)
Distributions - common stock	(80,660)		(80,660)							(80,660)
Distributions - preferred stock	(10,346)		(10,346)							(10,346)
Distributions - noncontrolling interest	(7,006)										(7,006)
Net income	95,055		88,266							88,266	6,789
Balance ending (in shares) at Sep. 30, 2023					42,585,589		188,501,642
Balance ending at Sep. 30, 2023	$ 3,240,501		$ 3,104,785		$ 633,684		$ 1,885	$ 2,364,395		$ 104,821	$ 135,716

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Operating activities:
Net income	$ 290,634	$ 247,101
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	7,297	6,092
Stock-based compensation	12,141	12,330
Amortization and accretion of interest and fees, net	(3,084)	(10,022)
Amortization of capitalized mortgage servicing rights	46,920	44,532
Originations of loans held-for-sale	(3,619,570)	(3,232,962)
Proceeds from sales of loans held-for-sale, net of gain on sale	3,607,665	3,699,555
Mortgage servicing rights	(48,769)	(52,287)
Write-off of capitalized mortgage servicing rights from payoffs	11,764	37,318
Provision for loss sharing (net of recoveries)	12,528	(2,199)
Provision for credit losses (net of recoveries)	55,047	9,700
Net charge-offs for loss sharing obligations	(434)	(354)
Deferred tax benefit	(6,630)	(7,833)
Income from equity affiliates	(20,694)	(18,507)
Distributions from operations of equity affiliates	22,507	16,546
Change in fair value of held-for-sale loans	(1,634)	12,163
Loss on extinguishment of debt	1,561	4,612
Payoffs and paydowns of loans held-for-sale	463	58,339
Loss on sale of loans	0	10,120
Changes in operating assets and liabilities	(209,214)	(23,138)
Net cash provided by operating activities	158,498	811,106
Investing Activities:
Loans and investments funded, originated and purchased, net	(1,061,865)	(5,418,113)
Payoffs and paydowns of loans and investments	2,541,373	2,302,874
Proceeds from sale of loans and investments	0	397,338
Deferred fees	13,624	50,385
Contributions to equity affiliates	(1,029)	(16,730)
Distributions from equity affiliates	15,552	24,321
Purchase of securities held-to-maturity, net	0	(27,598)
Payoffs and paydowns of securities held-to-maturity	3,544	16,676
Due to borrowers and reserves	(92,358)	(152,036)
Net cash provided by (used in) investing activities	1,418,841	(2,822,883)
Financing activities:
Proceeds from credit and repurchase facilities	6,575,575	8,474,821
Paydowns and payoffs of credit and repurchase facilities	(7,033,287)	(8,325,608)
Payoffs and paydowns of securitized debt	(856,864)	(441,000)
Proceeds from issuance of common stock	193,660	312,766
Proceeds from issuance of senior unsecured notes	95,000	0
Payoffs and paydowns of senior unsecured notes	(149,600)	0
Payments of withholding taxes on net settlement of vested stock	(8,352)	(8,085)
Repurchase of common stock	(37,432)	0
Distributions to stockholders	(282,029)	(234,246)
Payment of deferred financing costs	(7,719)	(35,267)
Proceeds from issuance of securitized debt	0	2,525,624
Proceeds from issuance of convertible senior unsecured notes	0	287,500
Extinguishment of convertible senior unsecured notes	0	(200,662)
Proceeds from issuance of preferred stock	0	77,392
Redemption of operating partnership units	0	(546)
Net cash (used in) provided by financing activities	(1,511,048)	2,432,689
Net increase in cash, cash equivalents and restricted cash	66,291	420,912
Cash, cash equivalents and restricted cash at beginning of period	1,248,165	891,270
Cash, cash equivalents and restricted cash at end of period	1,314,456	1,312,182
Reconciliation of cash, cash equivalents and restricted cash:
Cash and cash equivalents at beginning of period	534,357	404,580
Restricted cash at beginning of period	713,808	486,690
Cash, cash equivalents and restricted cash at beginning of period	1,248,165	891,270
Cash and cash equivalents at end of period	895,298	389,651
Restricted cash at end of period	419,158	922,531
Cash, cash equivalents and restricted cash at end of period	1,314,456	1,312,182
Supplemental cash flow information:
Cash used to pay interest	654,108	306,671
Cash used to pay taxes	22,916	25,770
Supplemental schedule of non-cash investing and financing activities:
Distributions accrued on preferred stock	7,010	7,010
Cumulative-effect adjustment (adoption of convertible debt standard)	$ 0	$ 2,447

XML

Description of Business

9 Months Ended

Sep. 30, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Description of Business

Description of Business

Arbor Realty Trust, Inc. (“we,” “us,” or “our”) is a Maryland corporation formed in 2003. We are a nationwide real estate investment trust (“REIT”) and direct lender, providing loan origination and servicing for commercial real estate assets. We operate through two business segments: our Structured Loan Origination and Investment Business, or “Structured Business,” and our Agency Loan Origination and Servicing Business, or “Agency Business.”

Through our Structured Business, we invest in a diversified portfolio of structured finance assets in the multifamily, single-family rental (“SFR”) and commercial real estate markets, primarily consisting of bridge loans, in addition to mezzanine loans, junior participating interests in first mortgages and preferred and direct equity. We also invest in real estate-related joint ventures and may directly acquire real property and invest in real estate-related notes and certain mortgage-related securities.

Through our Agency Business, we originate, sell and service a range of multifamily finance products through the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac,” and together with Fannie Mae, the government-sponsored enterprises, or “GSEs”), the Government National Mortgage Association (“Ginnie Mae”), Federal Housing Authority (“FHA”) and the U.S. Department of Housing and Urban Development (together with Ginnie Mae and FHA, “HUD”). We retain the servicing rights and asset management responsibilities on substantially all loans we originate and sell under the GSE and HUD programs. We are an approved Fannie Mae Delegated Underwriting and Servicing (“DUS”) lender nationally, a Freddie Mac Multifamily Conventional Loan lender, seller/servicer in New York, New Jersey and Connecticut, a Freddie Mac affordable, manufactured housing, senior housing and small balance loan (“SBL”) lender, seller/servicer nationally and a HUD MAP and LEAN senior housing/healthcare lender nationally. We also originate and service permanent financing loans underwritten using the guidelines of our existing agency loans sold to the GSEs, which we refer to as “Private Label” loans, and originate and sell finance products through conduit/commercial mortgage-backed securities (“CMBS”) programs. We pool and securitize the Private Label loans and sell certificates in the securitizations to third-party investors, while retaining the servicing rights and the highest risk bottom tranche certificate of the securitization (“APL certificates”).

Substantially all of our operations are conducted through our operating partnership, Arbor Realty Limited Partnership (“ARLP”), for which we serve as the indirect general partner, and ARLP’s subsidiaries. We are organized to qualify as a REIT for U.S. federal income tax purposes. A REIT is generally not subject to federal income tax on that portion of its REIT-taxable income that is distributed to its stockholders, provided that at least 90% of taxable income is distributed and provided that certain other requirements are met. Certain of our assets that produce non-qualifying REIT income, primarily within the Agency Business, are operated through taxable REIT subsidiaries (“TRS”), which are part of our TRS consolidated group (the “TRS Consolidated Group”) and are subject to U.S. federal, state and local income taxes. In general, our TRS entities may hold assets that the REIT cannot hold directly and may engage in real estate or non-real estate-related business.

XML

Basis of Presentation and Significant Accounting Policies

9 Months Ended

Sep. 30, 2023

Accounting Policies [Abstract]

Basis of Presentation and Significant Accounting Policies

Basis of Presentation and Significant Accounting Policies

Basis of Presentation

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), for interim financial statements and the instructions to Form 10-Q. Accordingly, certain information and footnote disclosures normally included in the consolidated financial statements prepared under GAAP have been condensed or omitted. In our opinion, all adjustments considered necessary for a fair presentation of our financial position, results of operations and cash flows have been included and are of a normal and recurring nature. The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. These financial statements should be read in conjunction with our financial statements and notes thereto included in our 2022 Annual Report.

Principles of Consolidation

The consolidated financial statements include our financial statements and the financial statements of our wholly owned subsidiaries, partnerships and other entities in which we own a controlling interest, including variable interest entities (“VIEs”) of which we are the primary beneficiary. Entities in which we have a significant influence are accounted for under the equity method. Our VIEs are described in Note 14. All significant intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that could materially affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The ultimate impact of inflation, increasing interest rates, bank failures, tightening of capital markets and

reduced property values, both globally and to our business, makes any estimate or assumption at September 30, 2023 inherently less certain.

Reclassification

Certain amounts in the prior period financial statements have been reclassified to conform to the presentation of the current period financial statements.

Recently Adopted Accounting Pronouncements

Description	Adoption Date	Effect on Financial Statements
In March 2022, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2022-02, Financial Instruments—Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures. This guidance eliminates the accounting guidance on troubled debt restructurings and amends existing disclosures, including the requirement to disclose current period gross write-offs by year of origination. The guidance also updates the requirements related to accounting for credit losses and adds enhanced disclosures for creditors with respect to loan refinancings and restructurings for borrowers experiencing financial difficulty.	First quarter of 2023	The adoption of this guidance did not have a material impact on our consolidated financial statements.

Recently Issued Accounting Pronouncements

In March 2023, the FASB issued ASU 2023-01, Leases (Topic 842) – Common Control Arrangements and ASU 2023-02, Investments – Equity Method and Joint Ventures: Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method, both effective for us in the first quarter of 2024. In August 2023, the FASB issued ASU 2023-05, Business Combinations – Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement, which is effective for joint venture entities with a formation date on or after January 1, 2025. We currently do not have any transactions that fall under the scope of these ASUs; therefore, the adoptions are not expected to have an impact on our consolidated financial statements.

Significant Accounting Policies

See Item 8 – Financial Statements and Supplementary Data in our 2022 Annual Report for a description of our significant accounting policies. There have been no significant changes to our significant accounting policies since December 31, 2022.

XML

Loans and Investments

9 Months Ended

Sep. 30, 2023

Loans and Investments

Loans and Investments

Loans and Investments

Our Structured Business loan and investment portfolio consists of ($ in thousands):

	September 30, 2023		Percent of Total		Loan Count	Wtd. Avg. Pay Rate (1)		Wtd. Avg. Remaining Months to Maturity	Wtd. Avg. First Dollar LTV Ratio (2)		Wtd. Avg. Last Dollar LTV Ratio (3)
Bridge loans (4)	$	12,790,972	97	%	664	8.85	%	13.8	0	%	77	%
Mezzanine loans	233,805		2	%	47	8.35	%	54.7	45	%	79	%
Preferred equity investments	87,924		1	%	10	3.03	%	62.0	47	%	84	%
Other loans (5)	9,694		<1%		2	9.72	%	15.6	0	%	62	%
	13,122,395		100	%	723	8.80	%	14.9	1	%	77	%
Allowance for credit losses	(184,069)
Unearned revenue	(45,530)
Loans and investments, net	$	12,892,796
	December 31, 2022
Bridge loans (4)	$	14,096,054	98	%	692	8.17	%	19.8	0	%	76	%
Mezzanine loans	213,499		1	%	44	8.13	%	63.1	42	%	77	%
Preferred equity investments	110,725		1	%	8	7.63	%	39.2	46	%	79	%
Other loans (5)	35,845		<1%		3	8.76	%	32.8	0	%	58	%
	14,456,123		100	%	747	8.17	%	20.6	1	%	76	%
Allowance for credit losses	(132,559)
Unearned revenue	(68,890)
Loans and investments, net	$	14,254,674

________________________

(1)“Weighted Average Pay Rate” is a weighted average, based on the unpaid principal balance (“UPB”) of each loan in our portfolio, of the interest rate required to be paid monthly as stated in the individual loan agreements. Certain loans and investments that require an accrual rate to be paid at maturity are not included in the weighted average pay rate as shown in the table.

(2)The “First Dollar Loan-to-Value (“LTV”) Ratio” is calculated by comparing the total of our senior most dollar and all senior lien positions within the capital stack to the fair value of the underlying collateral to determine the point at which we will absorb a total loss of our position.

(3)The “Last Dollar LTV Ratio” is calculated by comparing the total of the carrying value of our loan and all senior lien positions within the capital stack to the fair value of the underlying collateral to determine the point at which we will initially absorb a loss.

(4)At September 30, 2023 and December 31, 2022, bridge loans included 311 and 241, respectively, of SFR loans with a total gross loan commitment of $2.05 billion and $1.57 billion, respectively, of which $1.16 billion and $927.4 million, respectively, was funded.

(5)Other loans represents variable rate SFR permanent loans.

Concentration of Credit Risk

We are subject to concentration risk in that, at September 30, 2023, the UPB related to 92 loans with five different borrowers represented 12% of total assets. At December 31, 2022, the UPB related to 38 loans with five different borrowers represented 11% of total assets. During both the three and nine months ended September 30, 2023 and the year ended December 31, 2022, no single loan or investment represented more than 10% of our total assets and no single investor group generated over 10% of our revenue. See Note 17 for details on our concentration of related party loans and investments.

We assign a credit risk rating of pass, pass/watch, special mention, substandard or doubtful to each loan and investment, with a pass rating being the lowest risk and a doubtful rating being the highest risk. Each credit risk rating has benchmark guidelines that pertain to debt-service coverage ratios, LTV ratios, borrower strength, asset quality, and funded cash reserves. Other factors such as guarantees, market strength, and remaining loan term and borrower equity are also reviewed and factored into determining the credit risk rating assigned to each loan. This metric provides a helpful snapshot of portfolio quality and credit risk. All portfolio assets are subject to, at a minimum, a

thorough quarterly financial evaluation in which historical operating performance and forward-looking projections are reviewed, however, we maintain a higher level of scrutiny and focus on loans that we consider “high risk” and that possess deteriorating credit quality.

Generally speaking, given our typical loan profile, risk ratings of pass, pass/watch and special mention suggest that we expect the loan to make both principal and interest payments according to the contractual terms of the loan agreement. A risk rating of substandard indicates we anticipate the loan may require a modification of some kind. A risk rating of doubtful indicates we expect the loan to underperform over its term, and there could be loss of interest and/or principal. Further, while the above are the primary guidelines used in determining a certain risk rating, subjective items such as borrower strength, market strength or asset quality may result in a rating that is higher or lower than might be indicated by any risk rating matrix.

A summary of the loan portfolio’s internal risk ratings and LTV ratios by asset class at September 30, 2023 is as follows ($ in thousands):

	UPB by Origination Year												Total			Wtd. Avg. First Dollar LTV Ratio		Wtd. Avg. Last Dollar LTV Ratio
Asset Class / Risk Rating	2023		2022		2021		2020		2019		Prior
Multifamily:
Pass	$	97,186	$	131,266	$	97,269	$	2,010	$	—	$	20,300	$	348,031
Pass/Watch	673,165		2,378,519		3,015,502		81,560		112,416		58,394		6,319,556
Special Mention	799		1,830,803		2,353,938		219,050		140,685		—		4,545,275
Substandard	—		290,492		153,697		24,099		—		—		468,288
Doubtful	—		—		13,930		—		9,765		—		23,695
Total Multifamily	$	771,150	$	4,631,080	$	5,634,336	$	326,719	$	262,866	$	78,694	$	11,704,845		1	%	78	%
Single-Family Rental:	Percentage of portfolio												89		%
Pass	$	22,208	$	—	$	—	$	—	$	—	$	—	$	22,208
Pass/Watch	161,976		466,391		355,176		86,347		20,965		—		1,090,855
Special Mention	—		22,924		12,852		24,503		—		—		60,279
Total Single-Family Rental	$	184,184	$	489,315	$	368,028	$	110,850	$	20,965	$	—	$	1,173,342		0	%	63	%
Land:	Percentage of portfolio												9		%
Pass/Watch	$	—	$	—	$	—	$	4,600	$	—	$	—	$	4,600
Special Mention	—		—		—		3,500		—		—		3,500
Substandard	—		—		—		—		—		127,928		127,928
Total Land	$	—	$	—	$	—	$	8,100	$	—	$	127,928	$	136,028		0	%	98	%
Office:	Percentage of portfolio												1		%
Special Mention	$	—	$	—	$	—	$	35,410	$	—	$	—	$	35,410
Substandard	—		—		—		—		—		45,025		45,025
Total Office	$	—	$	—	$	—	$	35,410	$	—	$	45,025	$	80,435		0	%	90	%
Retail:	Percentage of portfolio												1		%
Pass/Watch	$	—	$	—	$	—	$	—	$	4,000	$	—	$	4,000
Special Mention	—		—		—		—		—		3,445		3,445
Substandard	—		—		—		—		—		18,600		18,600
Total Retail	$	—	$	—	$	—	$	—	$	4,000	$	22,045	$	26,045		11	%	71	%
Other:	Percentage of portfolio												< 1%
Doubtful	$	—	$	—	$	—	$	—	$	—	$	1,700	$	1,700
Total Other	$	—	$	—	$	—	$	—	$	—	$	1,700	$	1,700		63	%	63	%
	Percentage of portfolio												< 1%
Grand Total	$	955,334	$	5,120,395	$	6,002,364	$	481,079	$	287,831	$	275,392	$	13,122,395		1	%	77	%

Geographic Concentration Risk

At September 30, 2023, underlying properties in Texas and Florida represented 24% and 16%, respectively, of the outstanding balance of our loan and investment portfolio. At December 31, 2022, underlying properties in Texas and Florida represented 22% and 14%, respectively, of the outstanding balance of our loan and investment portfolio. No other states represented 10% or more of the total loan and investment portfolio.

Allowance for Credit Losses

A summary of the changes in the allowance for credit losses is as follows (in thousands):

	Three Months Ended September 30, 2023
	Multifamily		Land		Office		Retail		Commercial		Single-Family Rental		Other		Total
Allowance for credit losses:
Beginning balance	$	74,295	$	77,902	$	8,246	$	5,819	$	1,700	$	1,077	$	15	$	169,054
Provision for credit losses (net of recoveries)	14,884		60		(76)		—		—		162		(15)		15,015
Ending balance	$	89,179	$	77,962	$	8,170	$	5,819	$	1,700	$	1,239	$	—	$	184,069
	Three Months Ended September 30, 2022
Allowance for credit losses:
Beginning balance	$	27,958	$	77,918	$	7,031	$	5,819	$	1,700	$	725	$	180	$	121,331
Provision for credit losses (net of recoveries)	(675)		(8)		306		—		—		1,326		16		965
Ending balance	$	27,283	$	77,910	$	7,337	$	5,819	$	1,700	$	2,051	$	196	$	122,296
	Nine Months Ended September 30, 2023
Allowance for credit losses:
Beginning balance	$	37,961	$	78,068	$	8,162	$	5,819	$	1,700	$	781	$	68	$	132,559
Provision for credit losses (net of recoveries)	51,218		(106)		8		—		—		458		(68)		51,510
Ending balance	$	89,179	$	77,962	$	8,170	$	5,819	$	1,700	$	1,239	$	—	$	184,069
	Nine Months Ended September 30, 2022
Allowance for credit losses:
Beginning balance	$	18,707	$	77,970	$	8,073	$	5,819	$	1,700	$	320	$	652	$	113,241
Provision for credit losses (net of recoveries)	8,576		(60)		(736)		—		—		1,731		(456)		9,055
Ending balance	$	27,283	$	77,910	$	7,337	$	5,819	$	1,700	$	2,051	$	196	$	122,296

During the three and nine months ended September 30, 2023, we recorded a $15.0 million and a $51.5 million provision for credit losses, respectively. The increase in the provision for credit losses during the three and nine months ended September 30, 2023 was primarily attributable to the impact from the macroeconomic outlook of the commercial real estate market. Our estimate of allowance for credit losses on our structured loans and investments, including related unfunded loan commitments, was based on a reasonable and supportable forecast period that reflects recent observable data, including an increase in interest rates, higher unemployment forecasts, and continuing inflationary pressures, including an estimated continual decline in real estate values and other market factors.

The expected credit losses over the contractual period of our loans also include the obligation to extend credit through our unfunded loan commitments. Our current expected credit loss (“CECL”) allowance for unfunded loan commitments is adjusted quarterly and corresponds with the associated outstanding loans. At September 30, 2023 and December 31, 2022, we had outstanding unfunded commitments of $1.08 billion and $1.15 billion, respectively, that we are obligated to fund as borrowers meet certain requirements.

At September 30, 2023 and December 31, 2022, accrued interest receivable related to our loans totaling $116.4 million and $108.5 million, respectively, was excluded from the estimate of credit losses and is included in other assets on the consolidated balance sheets.

All of our structured loans and investments are secured by real estate assets or by interests in real estate assets, and, as such, the measurement of credit losses may be based on the difference between the fair value of the underlying collateral and the carrying value of the assets as of the period end. A summary of our specific loans considered impaired by asset class is as follows ($ in thousands):

	September 30, 2023
Asset Class	UPB (1)		Carrying Value		Allowance for Credit Losses		Wtd. Avg. First Dollar LTV Ratio		Wtd. Avg. Last Dollar LTV Ratio
Land	$	134,215	$	127,868	$	77,869	0	%	99	%
Multifamily	90,070		87,995		17,750		0	%	100	%
Office	45,025		45,025		7,951		0	%	99	%
Retail	22,045		17,670		5,817		13	%	78	%
Commercial	1,700		1,700		1,700		63	%	63	%
Total	$	293,055	$	280,258	$	111,087	1	%	97	%
	December 31, 2022
Land	$	134,215	$	127,868	$	77,869	0	%	99	%
Retail	22,045		17,563		5,817		14	%	79	%
Commercial	1,700		1,700		1,700		63	%	63	%
Total	$	157,960	$	147,131	$	85,386	3	%	96	%

________________________

(1)Represents the UPB of thirteen and seven impaired loans (less unearned revenue and other holdbacks and adjustments) by asset class at September 30, 2023 and December 31, 2022, respectively.

There were no loans for which the fair value of the collateral securing the loan was less than the carrying value of the loan for which we had not recorded a provision for credit loss at September 30, 2023 and December 31, 2022.

Loans are classified as non-performing once the contractual payments reach 60 days past due. Income from non-performing loans is generally recognized on a cash basis when it is received. Full income recognition will resume when the loan becomes contractually current, and performance has recommenced. At September 30, 2023, twelve loans with an aggregate net carrying value of $137.9 million, net of loan loss reserves of $12.6 million, were classified as non-performing and, at December 31, 2022, four loans with an aggregate net carrying value of $2.6 million, net of related loan loss reserves of $5.1 million, were classified as non-performing.

A summary of our non-performing loans by asset class is as follows (in thousands):

	September 30, 2023						December 31, 2022
	UPB		Less Than 90 Days Past Due		Greater Than 90 Days Past Due		UPB		Less Than 90 Days Past Due		Greater Than 90 Days Past Due
Multifamily	$	152,717	$	122,847	$	29,870	$	2,605	$	—	$	2,605
Retail	3,445		—		3,445		3,445		—		3,445
Commercial	1,700		—		1,700		1,700		—		1,700
Total	$	157,862	$	122,847	$	35,015	$	7,750	$	—	$	7,750

At both September 30, 2023 and December 31, 2022, we had no loans contractually past due 90 days or more that are still accruing interest. During the nine months ended September 30, 2023 and 2022, we received $2.8 million and zero, respectively, of interest income on non-accrual loans.

In addition, we have six loans with a carrying value totaling $121.4 million at September 30, 2023, that are collateralized by a land development project. The loans do not carry a current pay rate of interest, however, five of the loans with a carrying value totaling $112.1 million entitle us to a weighted average accrual rate of interest of 7.91%. In 2008, we suspended the recording of the accrual rate of interest on these loans, as they were impaired and we deemed the collection of this interest to be doubtful. At both September 30, 2023 and December 31, 2022, we had a cumulative allowance for credit losses of $71.4 million related to these loans. The loans are subject to certain risks associated with a development project including, but not limited to, availability of construction financing, increases in

projected construction costs, demand for the development’s outputs upon completion of the project, and litigation risk. Additionally, these loans were not classified as non-performing as the borrower is compliant with all of the terms and conditions of the loans.

In the second quarter of 2023, a borrower of a $70.5 million multifamily bridge loan, with an interest rate of SOFR plus 3.40% and a maturity date of September 2024, defaulted on its interest payments and, as a result, this loan was classified as a non-performing loan. In September 2023, the borrower sold the underlying property to a third party who assumed our loan. At the time of the property sale, we entered into a loan modification agreement with the new borrower to extend the maturity to September 2025 and reduce the interest rate to a fixed pay rate of 3.00% and an accrual rate of 3.00% for a total fixed rate of 6.00% for a period of eighteen months, after which the interest rate resumes to the original rate for the duration of the loan. The new borrower was also required to fund $10.5 million over time: $2.5 million in interest reserves, which was funded at the closing of the loan assumption, and $8.0 million in capital improvements within fifteen months. If the new borrower fails to timely complete the required capital improvements, it will be required to fund a renovation reserve at the lesser of (1) $2.5 million and (2) the difference between the $8.0 million capital commitment and the costs actually incurred for such capital improvements. The key principal is also personally guaranteeing the $8.0 million capital improvement.

There were no other loan modifications, refinancings and/or extensions during the three and nine months ended September 30, 2022 to borrowers experiencing financial difficulty.

In April 2023, we exercised our right to foreclose on a group of properties in Houston, Texas that are the underlying collateral for four bridge loans with a total UPB of $217.4 million. We simultaneously sold these properties to a significant equity investor in the original bridge loans and provided new bridge loan financing as part of the sale. We did not record a loss on the original bridge loans and recovered all the outstanding interest owed to us as part of this restructuring.

During the second quarter of 2022, we sold a bridge loan and mezzanine loans totaling $110.5 million, that were collateralized by a land development project, at a discount for $102.2 million. In connection with this transaction, we had $66.3 million of capital returned to us to be used in future investments and recorded a $9.2 million loss (including fees and expenses), which was included in other income (loss), net on the consolidated statements of income. We have the potential to recover up to $2.8 million depending on the future performance of the loan.

In July 2022, we sold four bridge loans with an aggregate UPB of $296.9 million at par less shared loan origination fees and selling costs totaling $2.0 million and had $78.0 million of capital returned to us to be used in future investments. The shared loan origination fees and selling costs were recorded as an unrealized impairment loss in the second quarter of 2022 and included in other income (loss), net on the consolidated statements of income. We have retained the right to service these loans. During the three months ended June 30, 2023, we repurchased two of these bridge loans with an aggregate UPB of $182.0 million at par.

Given the transitional nature of some of our real estate loans, we may require funds to be placed into an interest reserve, based on contractual requirements, to cover debt service costs. At September 30, 2023 and December 31, 2022, we had total interest reserves of $125.8 million and $123.7 million, respectively, on 516 loans and 480 loans, respectively, with an aggregate UPB of $8.31 billion and $7.70 billion, respectively.

XML

Loans Held-for-Sale, Net

9 Months Ended

Sep. 30, 2023

Receivable, Held-for-Sale [Abstract]

Loans Held-for-Sale, Net

Loans Held-for-Sale, Net

Our GSE loans held-for-sale are typically sold within 60 days of loan origination, while our non-GSE loans are generally expected to be sold to third parties or securitized within 180 days of loan origination. Loans held-for-sale, net consists of the following (in thousands):

	September 30, 2023		December 31, 2022
Fannie Mae	$	257,371	$	173,020
Freddie Mac	86,089		8,938
Private Label	11,350		152,735
SFR - Fixed Rate	8,710		12,352
FHA	4,810		21,021
	368,330		368,066
Fair value of future MSR	4,302		5,557
Unrealized impairment loss	(2,891)		(15,703)
Unearned discount	(5,421)		(3,850)
Loans held-for-sale, net	$	364,320	$	354,070

During the three and nine months ended September 30, 2023, we sold $1.28 billion and $3.62 billion of loans held-for-sale, respectively, and $1.08 billion and $3.70 billion during the three and nine months ended September 30, 2022, respectively. Included in the total loans sold during 2022 were $489.3 million of Private Label loans that were sold to unconsolidated affiliates of ours who securitized the loans. We retained the most subordinate class of certificates in this securitization totaling $43.4 million in satisfaction of credit risk retention requirements and we are also the primary servicer of the mortgage loans.

During 2022, we recorded a loss of $5.2 million (net of corresponding swap gains associated with these loans) on seven Private Label loans with a UPB of $129.9 million and a net carrying value of $116.4 million. During the first quarter of 2023, we sold these loans and recorded a gain of $0.9 million.

During the three months ended June 30, 2022, we determined that the fair value of certain loans held-for-sale were below their carrying values and, based on the fair value analysis performed, we recorded an unrealized impairment loss of $4.1 million. The unrealized impairment loss was included in other income (loss), net on the consolidated statements of income.

At September 30, 2023 and December 31, 2022, there were no loans held-for-sale that were 90 days or more past due, and there were no loans held-for-sale that were placed on a non-accrual status.

XML

Capitalized Mortgage Servicing Rights

9 Months Ended

Sep. 30, 2023

Transfers and Servicing [Abstract]

Capitalized Mortgage Servicing Rights

Capitalized Mortgage Servicing Rights

Our capitalized mortgage servicing rights (“MSRs”) reflect commercial real estate MSRs derived primarily from loans sold in our Agency Business or acquired MSRs. The discount rates used to determine the present value of all our MSRs throughout the periods presented were between 8% - 13% (representing a weighted average discount rate of 12%) based on our best estimate of market discount rates. The weighted average estimated life remaining of our MSRs was 8.3 years and 8.6 years at September 30, 2023 and December 31, 2022, respectively.

A summary of our capitalized MSR activity is as follows (in thousands):

	Three Months Ended September 30, 2023						Nine Months Ended September 30, 2023
	Originated		Acquired		Total		Originated		Acquired		Total
Beginning balance	$	383,267	$	11,143	$	394,410	$	386,878	$	14,593	$	401,471
Additions	16,550		—		16,550		49,416		—		49,416
Amortization	(14,988)		(912)		(15,900)		(43,866)		(3,054)		(46,920)
Write-downs and payoffs	(2,400)		(457)		(2,857)		(9,999)		(1,765)		(11,764)
Ending balance	$	382,429	$	9,774	$	392,203	$	382,429	$	9,774	$	392,203
	Three Months Ended September 30, 2022						Nine Months Ended September 30, 2022
Beginning balance	$	391,397	$	20,137	$	411,534	$	395,573	$	27,161	$	422,734
Additions	18,907		—		18,907		63,002		—		63,002
Amortization	(13,355)		(1,427)		(14,782)		(39,348)		(5,184)		(44,532)
Write-downs and payoffs	(9,957)		(1,816)		(11,773)		(32,235)		(5,083)		(37,318)
Ending balance	$	386,992	$	16,894	$	403,886	$	386,992	$	16,894	$	403,886

We collected prepayment fees totaling $1.0 million and $6.1 million during the three and nine months ended September 30, 2023, respectively, and $11.2 million and $42.6 million during the three and nine months ended September 30, 2022, respectively. Prepayment fees are included as a component of servicing revenue, net on the consolidated statements of income. At September 30, 2023 and December 31, 2022, we had no valuation allowance recorded on any of our MSRs.

The expected amortization of capitalized MSRs recorded at September 30, 2023 is as follows (in thousands):

Year	Amortization
2023 (three months ending 12/31/2023)	$	16,169
2024	63,855
2025	60,481
2026	54,479
2027	49,654
2028	43,110
Thereafter	104,455
Total	$	392,203

Based on scheduled maturities, actual amortization may vary from these estimates.

XML

Mortgage Servicing

9 Months Ended

Sep. 30, 2023

Transfers and Servicing [Abstract]

Mortgage Servicing

Mortgage Servicing

Product and geographic concentrations that impact our servicing revenue are as follows ($ in thousands):

September 30, 2023
Product Concentrations					Geographic Concentrations
Product	UPB (1)		% of Total		State	UPB % of Total
Fannie Mae	$	20,463,620	68	%	Texas	11	%
Freddie Mac	5,184,888		17	%	New York	11	%
Private Label	2,371,475		8	%	North Carolina	8	%
FHA	1,322,832		5	%	California	8	%
Bridge (2)	305,950		1	%	Georgia	6	%
SFR - Fixed Rate	287,942		1	%	Florida	6	%
Total	$	29,936,707	100	%	New Jersey	5	%
					Illinois	4	%
					Other (3)	41	%
					Total	100	%
December 31, 2022
Fannie Mae	$	19,038,124	68	%	Texas	11	%
Freddie Mac	5,153,207		18	%	New York	11	%
Private Label	2,074,859		8	%	California	8	%
FHA	1,155,893		4	%	North Carolina	8	%
Bridge (2)	301,182		1	%	Georgia	6	%
SFR - Fixed Rate	274,764		1	%	Florida	5	%
Total	$	27,998,029	100	%	New Jersey	5	%
					Illinois	4	%
					Other (3)	42	%
					Total	100	%

________________________

(1)Excludes loans which we are not collecting a servicing fee.

(2)Represents bridge loans that were either sold by our Structured Business or refinanced by a third-party lender which we retained the right to service.

(3)No other individual state represented 4% or more of the total.

At September 30, 2023 and December 31, 2022, our weighted average servicing fee was 39.7 basis points and 41.1 basis points, respectively. At both September 30, 2023 and December 31, 2022, we held total escrow balances (including unfunded collateralized loan obligation holdbacks) of approximately $1.7 billion, of which approximately $1.6 billion and $1.5 billion, respectively, are not included in our consolidated balance sheets. These escrows are maintained in separate accounts at several federally insured depository institutions, which may exceed FDIC insured limits. We earn interest income on the total escrow deposits, which is generally based on a market rate of interest negotiated with the financial institutions that hold the escrow deposits. Interest earned on total escrows, net of interest paid to the borrower, is included as a component of servicing revenue, net in the consolidated statements of income as noted in the following table.

The components of servicing revenue, net are as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Servicing fees	$	32,191	$	30,631	$	92,479	$	93,702
Interest earned on escrows	20,985		7,450		57,501		10,073
Prepayment fees	1,044		11,218		6,080		42,588
Write-offs of MSRs	(2,857)		(11,773)		(11,764)		(37,318)
Amortization of MSRs	(15,900)		(14,782)		(46,920)		(44,532)
Servicing revenue, net	$	35,463	$	22,744	$	97,376	$	64,513

XML

Securities Held-To-Maturity

9 Months Ended

Sep. 30, 2023

Debt Securities, Held-to-Maturity, Amortized Cost, after Allowance for Credit Loss, Maturity [Abstract]

Securities Held-to-Maturity

Securities Held-to-Maturity

Agency Private Label Certificates (“APL certificates”). In connection with our Private Label securitizations, we retain the most subordinate class of the APL certificates in satisfaction of credit risk retention requirements. At September 30, 2023, we held APL certificates with an initial face value of $192.8 million, which were purchased at a discount for $119.0 million. These certificates are collateralized by 5-year to 10-year fixed rate first mortgage loans on multifamily properties, bear interest at an initial weighted average variable rate of 3.94% and have an estimated weighted average remaining maturity of 6.8 years. The weighted average effective interest rate was 8.85% at both September 30, 2023 and December 31, 2022, including the accretion of a portion of the discount deemed collectible. At September 30, 2023, approximately $18.2 million is estimated to mature after one year through five years and $174.6 million is estimated to mature after five years through ten years.

Agency B Piece Bonds. Freddie Mac may choose to hold, sell or securitize loans we sell to them under the Freddie Mac SBL program. As part of the securitizations under the SBL program, we have the ability to purchase the B Piece bond through a bidding process, which represents the bottom 10%, or highest risk, of the securitization. At September 30, 2023, we held 49%, or $106.2 million initial face value, of seven B Piece bonds, which were purchased at a discount for $74.7 million, and sold the remaining 51% to a third party. These securities are collateralized by a pool of multifamily mortgage loans, bear interest at an initial weighted average variable rate of 3.74% and have an estimated weighted average remaining maturity of 5.9 years. The weighted average effective interest rate was 11.19% and 12.20% at September 30, 2023 and December 31, 2022, respectively, including the accretion of a portion of the discount deemed collectible. At September 30, 2023, approximately $7.5 million is estimated to mature within one year, $14.8 million is estimated to mature after one year through five years and $16.5 million is estimated to mature after ten years.

A summary of our securities held-to-maturity is as follows (in thousands):

	Face Value		Net Carrying Value		Unrealized Gain (Loss)		Estimated Fair Value		Allowance for Credit Losses
September 30, 2023
APL certificates	$	192,791	$	127,547	$	(33,337)	$	94,210	$	2,340
B Piece bonds	38,786		27,625		4,773		32,398		3,603
Total	$	231,577	$	155,172	$	(28,564)	$	126,608	$	5,943
December 31, 2022
APL certificates	$	192,791	$	123,475	$	(13,348)	$	110,127	$	2,783
B Piece bonds	41,464		33,072		1,372		34,444		370
Total	$	234,255	$	156,547	$	(11,976)	$	144,571	$	3,153

A summary of the changes in the allowance for credit losses for our securities held-to-maturity is as follows (in thousands):

	Three Months Ended September 30, 2023
	APL Certificates		B Piece Bonds		Total
Beginning balance	$	3,375	$	1,159	$	4,534
Provision for credit loss expense/(reversal)	(1,035)		2,444		1,409
Ending balance	$	2,340	$	3,603	$	5,943
	Nine Months Ended September 30, 2023
Beginning balance	$	2,783	$	370	$	3,153
Provision for credit loss expense/(reversal)	(443)		3,233		2,790
Ending balance	$	2,340	$	3,603	$	5,943

The allowance for credit losses on our held-to-maturity securities was estimated on a collective basis by major security type and was based on a reasonable and supportable forecast period and a historical loss reversion for similar securities. The issuers continue to make timely principal and interest payments and we continue to accrue interest on all our securities.

We recorded interest income (including the amortization of discount) related to these investments of $3.6 million and $10.7 million during the three and nine months ended September 30, 2023, respectively, and $3.7 million and $13.9 million during the three and nine months ended September 30, 2022, respectively.

XML

Investments in Equity Affiliates

9 Months Ended

Sep. 30, 2023

Equity Method Investments and Joint Ventures [Abstract]

Investments in Equity Affiliates

Investments in Equity Affiliates

We account for all investments in equity affiliates under the equity method. A summary of these investments is as follows (in thousands):

	Investments in Equity Affiliates at				UPB of Loans to Equity Affiliates at September 30, 2023
Equity Affiliates	September 30, 2023		December 31, 2022
Arbor Residential Investor LLC	$	33,447	$	46,951	$	—
Fifth Wall Ventures	13,422		13,584		—
AMAC Holdings III LLC	13,156		15,825		—
Lightstone Value Plus REIT L.P.	1,895		1,895		—
Docsumo Pte. Ltd.	450		450		—
JT Prime	425		425		—
North Vermont Avenue	—		—		—
West Shore Café	—		—		1,688
Lexford Portfolio	—		—		—
East River Portfolio	—		—		—
Total	$	62,795	$	79,130	$	1,688

Arbor Residential Investor LLC (“ARI”). During the three and nine months ended September 30, 2023, we recorded a loss of $1.3 million and income of $1.3 million, respectively, and during the three and nine months ended September 30, 2022, we recorded income of $0.3 million and $6.4 million, respectively, to income from equity affiliates in our consolidated statements of income. During the three and nine months ended September 30, 2023, we received cash distributions of $7.5 million and $15.0 million, respectively, and during the three and nine months ended September 30, 2022, we received cash distributions of $7.3 million and $22.3 million, respectively, which were classified as returns on capital. The allocation of income is based on the underlying agreements, which may be different than our indirect interest, and at September 30, 2023 was 9.2%. At September 30, 2023, our indirect interest was 12.3%.

Fifth Wall Ventures (“Fifth Wall”). During the nine months ended September 30, 2023 and 2022, we funded an additional $0.8 million and $8.7 million, respectively, and during the three and nine months ended September 30, 2023, we recorded a loss associated with this investment of $0.8 million and $1.0 million, respectively. In addition, during the three and nine months ended September 30, 2022, we received distributions from this investment of $0.7 million and $1.6 million, respectively, which were classified as a return of capital.

AMAC Holdings III LLC (“AMAC III”). During the nine months ended September 30, 2023, we received distributions of $1.1 million, which were classified as returns of capital, and, during the three and nine months ended September 30, 2023, recorded losses associated

with this investment of $0.7 million and $1.6 million, respectively. During 2022, we funded an additional $4.9 million, and during the three and nine months ended September 30, 2022, recorded losses associated with this investment of $0.7 million and $1.8 million, respectively. In addition, during the three and nine months ended September 30, 2022, we received distributions of $0.2 million and $0.4 million, respectively, which were classified as returns of capital.

Lexford Portfolio. During the nine months ended September 30, 2023, we received distributions of $7.2 million and, during the three and nine months ended September 30, 2022, we received distributions of $5.0 million and $11.0 million, respectively, which were classified as returns on capital and recognized as income from equity affiliates.

Equity Participation Interest. During the three and nine months ended September 30, 2023, we received $3.5 million and $14.5 million, respectively, and, during the three months ended September 30, 2022, we received $2.6 million from equity participation interests on properties that were sold and which we had loans that previously paid-off. These were classified as returns of capital and recognized as income from equity affiliates.

See Note 17 for details of certain investments described above.

XML

Debt Obligations

9 Months Ended

Sep. 30, 2023

Debt Disclosure [Abstract]

Debt Obligations

Debt Obligations

Credit and Repurchase Facilities

Borrowings under our credit and repurchase facilities are as follows ($ in thousands):

				September 30, 2023						December 31, 2022
	Current Maturity	Extended Maturity	Note Rate Type	Debt Carrying Value (1)		Collateral Carrying Value		Wtd. Avg. Note Rate		Debt Carrying Value (1)		Collateral Carrying Value
Structured Business
$2.5B joint repurchase facility (2)	Jul. 2025	Jul. 2026	V	$	923,599	$	1,438,971	7.72	%	$	1,516,657	$	2,099,447
$1B repurchase facility (2)	Aug. 2025	Aug. 2026	V	418,206		621,759		7.58	%	498,666		703,740
$500M repurchase facility	(5)	N/A	V	374,072		505,139		8.34	%	154,653		188,563
$499M repurchase facility (2)(3)	Oct. 2023 (6)	N/A	V	343,726		491,190		7.67	%	351,056		504,506
$450M repurchase facility	Mar. 2024	Mar. 2026	V	328,650		452,318		7.50	%	344,237		450,736
$450M repurchase facility	Jan. 2024	Oct. 2024	V	93,410		120,947		7.01	%	186,639		239,678
$250M credit facility	July 2024	N/A	V	18,438		23,088		7.28	%	33,221		43,238
$225M credit facility	Jan. 2024	Jan. 2025	V	94,913		148,041		7.97	%	47,398		81,119
$200M repurchase facility	Mar. 2025	Mar. 2026	V	73,751		105,076		7.97	%	32,494		47,750
$200M repurchase facility	Jan. 2024	Jan. 2025	V	115,748		151,890		7.36	%	154,516		200,099
$174M loan specific credit facilities	Oct. 2023 (6) to Aug. 2025	Aug. 2025 to Aug. 2027	V/F	173,862		251,049		7.45	%	156,107		225,805
$50M credit facility	Apr. 2024	Apr. 2025	V	29,200		36,500		7.51	%	29,194		36,500
$40M credit facility	Apr. 2026	Apr. 2027	V	—		—		—		—		—
$35M working capital facility	Apr. 2024	N/A	V	—		—		—		—		—
$25M credit facility	Oct. 2024	N/A	V	18,248		24,625		8.02	%	18,701		24,572
Repurchase facility - securities (2)(4)	N/A	N/A	V	31,032		—		7.11	%	12,832		—
Structured Business total				$	3,036,855	$	4,370,593	7.70	%	$	3,536,371	$	4,845,753
Agency Business
$750M ASAP agreement	N/A	N/A	V	$	54,618	$	55,220	6.46	%	$	29,476	$	30,291
$500M joint repurchase facility (2)	Jul. 2025	Jul. 2026	V	7,701		11,350		7.74	%	104,629		135,641
$500M repurchase facility	Nov. 2023	N/A	V	144,818		145,618		6.69	%	66,778		66,866
$200M credit facility	Mar. 2024	N/A	V	143,654		144,168		6.71	%	31,475		33,177
$100M credit facility	July 2024	N/A	V	—		—		—		57,887		57,974
$50M credit facility	Sept. 2024	N/A	V	3,264		3,264		6.66	%	14,664		14,671
$1M repurchase facility (2)(3)	Oct. 2023 (6)	N/A	V	531		880		7.67	%	534		920
Agency Business total				$	354,586	$	360,500	6.69	%	$	305,443	$	339,540
Consolidated total				$	3,391,441	$	4,731,093	7.59	%	$	3,841,814	$	5,185,293

________________________

V = Variable Note Rate; F = Fixed Note Rate

(1)At September 30, 2023 and December 31, 2022, debt carrying value for the Structured Business was net of unamortized deferred finance costs of $6.6 million and $13.3 million, respectively, and for the Agency Business was net of unamortized deferred finance costs of $0.5 million and $0.9 million, respectively.

(2)These facilities are subject to margin call provisions associated with changes in interest spreads.

(3)A portion of this facility was used to finance a fixed-rate SFR permanent loan reported through our Agency Business.

(4)At September 30, 2023, this facility was collateralized by certificates retained by us from our Freddie Mac Q Series securitization (“Q Series securitization”) with a principal balance of $44.4 million. At December 31, 2022, this facility was collateralized by B Piece bonds with a carrying value of $33.1 million.

(5)The commitment amount under this repurchase facility expires six months after the lender provides written notice. We then have an additional six months to repurchase the underlying loans.

(6)These credit facilities, with a total committed amount of $514.5 million, mature on October 30, 2023 and we are currently in negotiations with these lenders to amend these facilities and extend the maturity.

During 2023, all of our remaining LIBOR-based financings were converted to a SOFR-based interest rate.

Structured Business

At September 30, 2023 and December 31, 2022, the weighted average interest rate for the credit and repurchase facilities of our Structured Business, including certain fees and costs, such as structuring, commitment, non-use and warehousing fees, was 8.14% and 6.95%, respectively. The leverage on our loan and investment portfolio financed through our credit and repurchase facilities, excluding the securities repurchase facility and the working capital facility, was 69% and 73% at September 30, 2023 and December 31, 2022, respectively.

In August 2023, we amended a $1.00 billion repurchase facility to extend the maturity to August 2025, with a one-year extension option, and amend the interest rate on new loans to SOFR plus 2.50%. The pricing on existing loans will remain unchanged until December 2023, at which time they will increase to SOFR plus 2.25%, as long as the weighted average spread of all loans is at least 2.40%. The pricing on existing loans will then increase to 2.50% in June 2024.

In July 2023, we amended our $3.00 billion joint repurchase facility, which is shared between our Structured Business and Agency Business. The facility size will remain at $3.00 billion until March 2024, at which time it will be reduced to $2.00 billion. In addition, the maturity was extended to July 2025, with a one-year extension option at the buyers discretion.

In July 2023, we amended a $400.0 million credit facility to decrease the facility size to $250.0 million, extend the maturity to July 2024 and amend the interest rates on new loans to SOFR plus 2.50% for multifamily loans, and SOFR plus 2.95% to 3.20% for non-multifamily loans.

In April 2023, we amended a $25.0 million credit facility to increase the facility size to $40.0 million and extend the maturity to April 2026.

In March 2023, we amended a $450.0 million repurchase facility to exercise a one-year extension option to March 2024 and amend the interest rate to a minimum of SOFR plus 2.00%.

Agency Business

In March 2023, we amended a $200.0 million credit facility to extend the maturity to March 2024 and amend the interest rate to SOFR plus 1.40%.

Securitized Debt

We account for securitized debt transactions on our consolidated balance sheet as financing facilities. These transactions are considered VIEs for which we are the primary beneficiary and are consolidated in our financial statements. The investment grade notes and guaranteed certificates issued to third parties are treated as secured financings and are non-recourse to us.

Borrowings and the corresponding collateral under our securitized debt transactions are as follows ($ in thousands):

	Debt						Collateral (3)
							Loans				Cash
September 30, 2023	Face Value		Carrying Value (1)		Wtd. Avg. Rate (2)		UPB		Carrying Value		Restricted Cash (4)
CLO 19	$	872,812	$	867,904	7.77	%	$	1,014,554	$	1,010,753	$	4,527
CLO 18	1,652,812		1,647,326		7.22	%	1,908,793		1,903,837		20,983
CLO 17	1,714,125		1,709,255		7.10	%	1,901,897		1,896,347		149,206
CLO 16	1,237,500		1,233,286		6.73	%	1,343,886		1,340,303		91,434
CLO 15	674,412		672,897		6.78	%	770,602		768,436		19,714
CLO 14 (5)	655,475		653,876		6.74	%	756,030		754,189		13,920
Total CLOs	6,807,136		6,784,544		7.08	%	7,695,762		7,673,865		299,784
Q Series securitization	222,066		220,090		7.31	%	296,088		294,876		—
Total securitized debt	$	7,029,202	$	7,004,634	7.09	%	$	7,991,850	$	7,968,741	$	299,784
December 31, 2022
CLO 19	$	872,812	$	866,605	6.75	%	$	952,268	$	947,336	$	64,300
CLO 18	1,652,812		1,645,711		6.19	%	1,899,174		1,891,215		85,970
CLO 17	1,714,125		1,707,676		6.16	%	1,911,866		1,904,732		145,726
CLO 16	1,237,500		1,231,887		5.79	%	1,307,244		1,301,794		106,495
CLO 15	674,412		671,532		5.84	%	797,755		795,078		2,861
CLO 14	655,475		652,617		5.80	%	732,247		730,057		37,090
CLO 13	462,769		461,005		6.03	%	552,182		550,924		37,875
CLO 12	379,283		378,331		6.09	%	466,474		465,003		500
Total CLOs	7,649,188		7,615,364		6.10	%	8,619,210		8,586,139		480,817
Q Series securitization	236,878		233,906		6.30	%	315,837		313,965		—
Total securitized debt	$	7,886,066	$	7,849,270	6.11	%	$	8,935,047	$	8,900,104	$	480,817

________________________

(1)Debt carrying value is net of $24.6 million and $36.8 million of deferred financing fees at September 30, 2023 and December 31, 2022, respectively.

(2)At September 30, 2023 and December 31, 2022, the aggregate weighted average note rate for our securitized debt, including certain fees and costs, was 7.34% and 6.32%, respectively.

(3)At September 30, 2023, four loans with an aggregate UPB of $89.8 million were deemed a "credit risk" as defined by the collateralized loan obligations ("CLO") indentures. At December 31, 2022, there was no collateral deemed a “credit risk” as defined by the CLO indentures. A credit risk asset is generally defined as one that, in the CLO collateral manager's reasonable business judgment, has a significant risk of becoming a defaulted asset.

(4)Represents restricted cash held for principal repayments as well as for reinvestment in the CLOs. Excludes restricted cash related to interest payments, delayed fundings and expenses totaling $108.5 million and $230.0 million at September 30, 2023 and December 31, 2022, respectively.

(5)The replenishment period of CLO 14 ended in September 2023.

CLO 13 and 12. In June 2023 and August 2023, we unwound CLO 13 and 12, respectively, redeeming the remaining outstanding notes, which were repaid primarily from the refinancing of the remaining assets within our other CLO vehicles and credit and repurchase facilities. We expensed $1.2 million and $0.3 million of deferred financing fees in the second and third quarter of 2023, respectively, into loss on extinguishment of debt on the consolidated statements of income.

In the first quarter of 2022, we unwound a CLO and expensed $1.4 million of deferred financing fees into loss on extinguishment of debt on the consolidated statements of income.

Senior Unsecured Notes

A summary of our senior unsecured notes is as follows ($ in thousands):

Senior Unsecured Notes	Issuance Date		September 30, 2023						December 31, 2022
		Maturity	UPB		Carrying Value (1)		Wtd. Avg. Rate (2)		UPB		Carrying Value (1)		Wtd. Avg. Rate (2)
7.75% Notes (3)	Mar. 2023	Mar. 2026	$	95,000	$	93,552	7.75	%	$	—	$	—	—
8.50% Notes (3)	Oct. 2022	Oct. 2027	150,000		147,904		8.50	%	150,000		147,519		8.50	%
5.00% Notes (3)	Dec. 2021	Dec. 2028	180,000		177,769		5.00	%	180,000		177,450		5.00	%
4.50% Notes (3)	Aug. 2021	Sept. 2026	270,000		267,555		4.50	%	270,000		266,926		4.50	%
5.00% Notes (3)	Apr. 2021	Apr. 2026	175,000		173,386		5.00	%	175,000		172,917		5.00	%
4.50% Notes (3)	Mar. 2020	Mar. 2027	275,000		273,322		4.50	%	275,000		272,960		4.50	%
4.75% Notes (4)	Oct. 2019	Oct. 2024	110,000		109,633		4.75	%	110,000		109,369		4.75	%
5.75% Notes (4)	Mar. 2019	Apr. 2024	90,000		89,805		5.75	%	90,000		89,514		5.75	%
8.00% Notes (3)	Apr. 2020	Apr. 2023	—		—		—		70,750		70,613		8.00	%
5.625% Notes (4)	Mar. 2018	May 2023	—		—		—		78,850		78,726		5.63	%
			$	1,345,000	$	1,332,926	5.41	%	$	1,399,600	$	1,385,994	5.40	%

________________________

(1)At September 30, 2023 and December 31, 2022, the carrying value is net of deferred financing fees of $12.1 million and $13.6 million, respectively.

(2)At September 30, 2023 and December 31, 2022, the aggregate weighted average note rate, including certain fees and costs, was 5.70% and 5.69%, respectively.

(3)These notes can be redeemed by us prior to three months before the maturity date, at a redemption price equal to 100% of the aggregate principal amount, plus a “make-whole” premium and accrued and unpaid interest. We have the right to redeem the notes within three months prior to the maturity date at a redemption price equal to 100% of the aggregate principal amount, plus accrued and unpaid interest.

(4)These notes can be redeemed by us at any time prior to the maturity date, at a redemption price equal to 100% of the aggregate principal amount, plus a “make-whole” premium and accrued and unpaid interest. We have the right to redeem the notes on the maturity date at a redemption price equal to 100% of the aggregate principal amount, plus accrued and unpaid interest.

In March 2023, we issued $95.0 million aggregate principal amount of 7.75% senior unsecured notes due in 2026 in a private offering. We received net proceeds of $93.4 million from the issuance, after deducting the placement agent commission and other offering expenses. We used $70.8 million of the proceeds, which included accrued interest and other fees, to repurchase the remaining portion of our 8.00% senior unsecured notes due in 2023.

In May 2023, our 5.625% senior unsecured notes matured and were redeemed for cash.

Convertible Senior Unsecured Notes

Our convertible senior unsecured notes are not redeemable by us prior to maturity (August 2025) and are convertible by the holder into, at our election, cash, shares of our common stock, or a combination of both, subject to the satisfaction of certain conditions and during specified periods. The conversion rates are subject to adjustment upon the occurrence of certain specified events and the holders may require us to repurchase all, or any portion, of their notes for cash equal to 100% of the principal amount, plus accrued and unpaid interest, if we undergo a fundamental change specified in the agreements.

The UPB and net carrying value of our convertible notes are as follows (in thousands):

Period	UPB		Unamortized Deferred Financing Fees		Net Carrying Value
September 30, 2023	$	287,500	$	5,072	$	282,428
December 31, 2022	$	287,500	$	7,144	$	280,356

During the three months ended September 30, 2023, we incurred interest expense on the notes totaling $6.1 million, of which $5.4 million and $0.7 million related to the cash coupon and deferred financing fees, respectively. During the nine months ended September 30, 2023, we incurred interest expense on the notes totaling $18.2 million, of which $16.1 million and $2.1 million related to the cash coupon and deferred financing fees, respectively. During the three months ended September 30, 2022, we incurred interest expense on the notes totaling $5.8 million, of which $5.0 million and $0.8 million related to the cash coupon and deferred financing fees, respectively. During the nine months ended September 30, 2022, we incurred interest expense on the notes totaling $13.4 million, of which $11.3 million and $2.1 million related to the cash coupon and deferred financing fees, respectively. Including the amortization of the deferred financing fees, our weighted average total cost of the notes was 8.42% at both September 30, 2023 and December 31, 2022. At September 30, 2023, the 7.50% convertible senior notes had a conversion rate of 60.2170 shares of common stock per $1,000 of principal, which represented a conversion price of $16.61 per share of common stock.

During the third quarter of 2022, our 4.75% convertible senior notes were repurchased and settled and we expensed $3.3 million of deferred financing fees into loss on extinguishment of debt.

Junior Subordinated Notes

The carrying values of borrowings under our junior subordinated notes were $143.7 million and $143.1 million at September 30, 2023 and December 31, 2022, respectively, which is net of a deferred amount of $9.1 million and $9.6 million, respectively, (which is amortized into interest expense over the life of the notes) and deferred financing fees of $1.5 million and $1.6 million at September 30, 2023 and December 31, 2022, respectively. These notes have maturities ranging from March 2034 through April 2037 and pay interest quarterly at a floating rate. The weighted average note rate was 8.55% and 7.65% at September 30, 2023 and December 31, 2022, respectively. Including certain fees and costs, the weighted average note rate was 8.63% and 7.74% at September 30, 2023 and December 31, 2022, respectively.

Debt Covenants

Credit and Repurchase Facilities and Unsecured Debt. The credit and repurchase facilities and unsecured debt (senior and convertible notes) contain various financial covenants, including, but not limited to, minimum liquidity requirements, minimum net worth requirements, minimum unencumbered asset requirements, as well as certain other debt service coverage ratios, debt to equity ratios and minimum servicing portfolio tests. We were in compliance with all financial covenants and restrictions at September 30, 2023.

CLOs. Our CLO vehicles contain interest coverage and asset overcollateralization covenants that must be met as of the waterfall distribution date in order for us to receive such payments. If we fail these covenants in any of our CLOs, all cash flows from the applicable CLO would be diverted to repay principal and interest on the outstanding CLO bonds and we would not receive any residual payments until that CLO regained compliance with such tests. Our CLOs were in compliance with all such covenants at September 30, 2023, as well as on the most recent determination dates in October 2023. In the event of a breach of the CLO covenants that could not be cured in the near-term, we would be required to fund our non-CLO expenses, including employee costs, distributions required to maintain our REIT status, debt costs, and other expenses with (1) cash on hand, (2) income from any CLO not in breach of a covenant test, (3) income from real property and loan assets, (4) sale of assets, or (5) accessing the equity or debt capital markets, if available. We have the right to cure covenant breaches which would resume normal residual payments to us by purchasing non-performing loans out of the CLOs. However, we may not have sufficient liquidity available to do so at such time.

Our CLO compliance tests as of the most recent determination dates in October 2023 are as follows:

Cash Flow Triggers	CLO 14		CLO 15		CLO 16		CLO 17		CLO 18		CLO 19
Overcollateralization (1)
Current	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%
Limit	118.76	%	119.85	%	120.21	%	121.51	%	123.03	%	119.30	%
Pass / Fail	Pass		Pass		Pass		Pass		Pass		Pass
Interest Coverage (2)
Current	153.74	%	151.78	%	148.88	%	143.35	%	148.56	%	132.54	%
Limit	120.00	%	120.00	%	120.00	%	120.00	%	120.00	%	120.00	%
Pass / Fail	Pass		Pass		Pass		Pass		Pass		Pass

________________________

(1)The overcollateralization ratio divides the total principal balance of all collateral in the CLO by the total principal balance of the bonds associated with the applicable ratio. To the extent an asset is considered a defaulted security, the asset’s principal balance for purposes of the overcollateralization test is the lesser of the asset’s market value or the principal balance of the defaulted asset multiplied by the asset’s recovery rate which is determined by the rating agencies. Rating downgrades of CLO collateral will generally not have a direct impact on the principal balance of a CLO asset for purposes of calculating the CLO overcollateralization test unless the rating downgrade is below a significantly low threshold (e.g. CCC-) as defined in each CLO vehicle.

(2)The interest coverage ratio divides interest income by interest expense for the classes senior to those retained by us.

Our CLO overcollateralization ratios as of the determination dates subsequent to each quarter are as follows:

Determination (1)	CLO 14		CLO 15		CLO 16		CLO 17		CLO 18		CLO 19
October 2023	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%
July 2023	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%
April 2023	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%
January 2023	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%
October 2022	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%

________________________

(1)This table represents the quarterly trend of our overcollateralization ratio, however, the CLO determination dates are monthly and we were in compliance with this test for all periods presented.

The ratio will fluctuate based on the performance of the underlying assets, transfers of assets into the CLOs prior to the expiration of their respective replenishment dates, purchase or disposal of other investments, and loan payoffs. No payment due under the junior subordinated indentures may be paid if there is a default under any senior debt and the senior lender has sent notice to the trustee. The junior subordinated indentures are also cross-defaulted with each other.

XML

Allowance for Loss-Sharing Obligations

9 Months Ended

Sep. 30, 2023

Loss Contingency Accrual, Disclosures [Abstract]

Allowance for Loss-Sharing Obligations

Allowance for Loss-Sharing Obligations

Our allowance for loss-sharing obligations related to the Fannie Mae DUS program is as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Beginning balance	$	66,681	$	53,053	$	57,168	$	56,064
Provisions for loss sharing	1,703		2,346		13,992		2,593
Provisions reversal for loan repayments	(24)		(1,934)		(1,464)		(4,792)
Recoveries (charge-offs), net	901		46		(435)		(354)
Ending balance	$	69,261	$	53,511	$	69,261	$	53,511

When a loan is sold under the Fannie Mae DUS program, we undertake an obligation to partially guarantee the performance of the loan. A liability is recognized for the fair value of the guarantee obligation undertaken for the non-contingent aspect of the guarantee and is removed only upon either the expiration or settlement of the guarantee. At September 30, 2023 and 2022, we had $34.6 million and $34.2 million, respectively, of guarantee obligations included in the allowance for loss-sharing obligations.

In addition to and separately from the fair value of the guarantee, we estimate our allowance for loss-sharing under CECL over the contractual period in which we are exposed to credit risk. The current expected loss related to loss-sharing was based on a collective pooling basis with similar risk characteristics, a reasonable and supportable forecast and a reversion period based on our average historical losses through the remaining contractual term of the portfolio.

When we settle a loss under the DUS loss-sharing model, the net loss is charged-off against the previously recorded loss-sharing obligation. The settled loss is often net of any previously advanced principal and interest payments in accordance with the DUS program, which are reflected as reductions to the proceeds needed to settle losses. At September 30, 2023 and December 31, 2022, we had outstanding advances of $0.3 million and $0.8 million, respectively, which were netted against the allowance for loss-sharing obligations.

At September 30, 2023 and December 31, 2022, our allowance for loss-sharing obligations, associated with expected losses under CECL, was $34.7 million and $22.7 million, respectively, and represented 0.17% and 0.12%, respectively, of our Fannie Mae servicing portfolio. During the three and nine months ended September 30, 2023, we recorded a $2.5 million and $11.9 million, respectively, increase in CECL reserves.

At September 30, 2023 and December 31, 2022, the maximum quantifiable liability associated with our guarantees under the Fannie Mae DUS agreement was $3.79 billion and $3.49 billion, respectively. The maximum quantifiable liability is not representative of the actual loss we would incur. We would be liable for this amount only if all of the loans we service for Fannie Mae, for which we retain some risk of loss, were to default and all of the collateral underlying these loans was determined to be without value at the time of settlement.

XML

Derivative Financial Instruments

9 Months Ended

Sep. 30, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

Derivative Financial Instruments

We enter into derivative financial instruments to manage exposures that arise from business activities resulting in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates and credit risk. We do not use these derivatives for speculative purposes, but are instead using them to manage our interest rate and credit risk exposure.

Agency Rate Lock and Forward Sale Commitments. We enter into contractual commitments to originate and sell mortgage loans at fixed prices with fixed expiration dates. The commitments become effective when the borrower “rate locks” a specified interest rate within time frames established by us. All potential borrowers are evaluated for creditworthiness prior to the extension of the commitment. Market risk arises if interest rates move adversely between the time of the rate lock by the borrower and the sale date of the loan to an investor. To mitigate the effect of the interest rate risk inherent in providing rate lock commitments to borrowers under the GSE programs, we enter into a forward sale commitment with the investor simultaneously with the rate lock commitment with the borrower. The forward sale contract locks in an interest rate and price for the sale of the loan. The terms of the contract with the investor and the rate lock with the borrower are matched in substantially all respects, with the objective of eliminating interest rate risk to the extent practical. Sale commitments with the investors have an expiration date that is longer than our related commitments to the borrower to allow, among other things, for closing of the loan and processing of paperwork to deliver the loan into the sale commitment.

These commitments meet the definition of a derivative and are recorded at fair value, including the effects of interest rate movements which are reflected as a component of gain (loss) on derivative instruments, net in the consolidated statements of income. The estimated fair value of rate lock commitments also includes the fair value of the expected net cash flows associated with the servicing of the loan which is recorded as income from MSRs in the consolidated statements of income. During the three and nine months ended September 30, 2023, we recorded a net losses of $1.0 million and $2.0 million, respectively, from changes in the fair value of these derivatives and $14.1 million and $48.8 million, respectively, of income from MSRs. During the three and nine months ended September 30, 2022, we recorded net losses of $22.9 million and $20.5 million, respectively, from changes in the fair value of these derivatives and $19.4 million and $52.3 million, respectively, of income from MSRs. See Note 12 for details.

Interest Rate and Credit Default Swaps (“Swaps”). We enter into over-the-counter swaps to hedge our interest rate and credit risk exposure inherent in (1) our held-for-sale Agency Business Private Label loans from the time the loans are rate locked until sale or securitization, and (2) our Agency Business SFR – fixed rate loans from the time the loans are originated until the time they can be financed with match term fixed rate securitized debt. Our interest rate swaps typically have a three-month maturity and are tied to the five-year and ten-year swap rates. Our credit default swaps typically have a five-year maturity, are tied to the credit spreads of the underlying bond issuers and we typically hold our position until we price our Private Label loan securitizations. The Swaps do not meet the criteria for hedge accounting, are cleared by a central clearing house and variation margin payments, made in cash, are treated as a legal settlement of the derivative itself as opposed to a pledge of collateral.

During the three months ended September 30, 2023, we recorded realized and unrealized gains of $0.4 million and $0.2 million, respectively, to our Agency Business related to our Swaps. During the nine months ended September 30, 2023, we recorded realized gains of $1.5 million and unrealized losses of $3.0 million to our Agency Business related to our Swaps. During the three months ended September 30, 2022, we recorded realized and unrealized gains of $3.6 million and $3.4 million, respectively, to our Agency Business related to our Swaps. During the nine months ended September 30, 2022, we recorded realized and unrealized gains of $27.2 million and $3.4 million, respectively, to our Agency Business related to our Swaps. The realized and unrealized gains and losses are recorded in gain (loss) on derivative instruments, net.

A summary of our non-qualifying derivative financial instruments in our Agency Business is as follows ($ in thousands):

	September 30, 2023
					Fair Value
Derivative	Count	Notional Value		Balance Sheet Location	Derivative Assets		Derivative Liabilities
Rate lock commitments	4	$	107,093	Other assets/other liabilities	$	962	$	(2,339)
Forward sale commitments	36	455,363		Other assets/other liabilities	2,379		(5,822)
Swaps	82	8,200			—		—
		$	570,656		$	3,341	$	(8,161)
	December 31, 2022
Rate lock commitments	6	$	91,472	Other assets/other liabilities	$	354	$	(1,070)
Forward sale commitments	27	294,451		Other assets/other liabilities	1,151		(3,827)
Swaps	1,298	129,800			—		—
		$	515,723		$	1,505	$	(4,897)

XML

Fair Value

9 Months Ended

Sep. 30, 2023

Fair Value Disclosures [Abstract]

Fair Value

Fair Value

Fair value estimates are dependent upon subjective assumptions and involve significant uncertainties resulting in variability in estimates with changes in assumptions. The following table summarizes the principal amounts, carrying values and the estimated fair values of our financial instruments (in thousands):

	September 30, 2023						December 31, 2022
	Principal / Notional Amount		Carrying Value		Estimated Fair Value		Principal / Notional Amount		Carrying Value		Estimated Fair Value
Financial assets:
Loans and investments, net	$	13,122,395	$	12,892,796	$	12,911,172	$	14,456,123	$	14,254,674	$	14,468,418
Loans held-for-sale, net	368,330		364,320		374,534		368,066		354,070		362,054
Capitalized mortgage servicing rights, net	n/a		392,203		538,078		n/a		401,471		530,913
Securities held-to-maturity, net	231,577		155,172		126,608		234,255		156,547		144,571
Derivative financial instruments	130,778		3,341		3,341		111,950		1,505		1,505
Financial liabilities:
Credit and repurchase facilities	$	3,398,451	$	3,391,441	$	3,382,933	$	3,856,009	$	3,841,814	$	3,828,192
Securitized debt	7,029,202		7,004,634		6,899,147		7,886,066		7,849,270		7,560,541
Senior unsecured notes	1,345,000		1,332,926		1,211,633		1,399,600		1,385,994		1,262,560
Convertible senior unsecured notes	287,500		282,428		290,019		287,500		280,356		287,834
Junior subordinated notes	154,336		143,695		105,821		154,336		143,128		103,977
Derivative financial instruments	431,678		8,161		8,161		273,973		4,897		4,897

Assets and liabilities disclosed at fair value are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Determining which category an asset or liability falls within the hierarchy requires judgment and we evaluate our

hierarchy disclosures each quarter. Hierarchical levels directly related to the amount of subjectivity associated with the inputs to fair valuation of these assets and liabilities are as follows:

Level 1—Inputs are unadjusted and quoted prices exist in active markets for identical assets or liabilities, such as government, agency and equity securities.

Level 2—Inputs (other than quoted prices included in Level 1) are observable for the asset or liability through correlation with market data. Level 2 inputs may include quoted market prices for a similar asset or liability, interest rates and credit risk. Examples include non-government securities, certain mortgage and asset-backed securities, certain corporate debt and certain derivative instruments.

Level 3—Inputs reflect our best estimate of what market participants would use in pricing the asset or liability and are based on significant unobservable inputs that require a considerable amount of judgment and assumptions. Examples include certain mortgage and asset-backed securities, certain corporate debt and certain derivative instruments.

The following is a description of the valuation techniques used to measure fair value and the general classification of these instruments pursuant to the fair value hierarchy.

Loans and investments, net. Fair values of loans and investments that are not impaired are estimated using inputs based on direct capitalization rate and discounted cash flow methodologies using discount rates, which, in our opinion, best reflect current market interest rates that would be offered for loans with similar characteristics and credit quality (Level 3). Fair values of impaired loans and investments are estimated using inputs that require significant judgments, which include assumptions regarding discount rates, capitalization rates, creditworthiness of major tenants, occupancy rates, availability of financing, exit plans and other factors (Level 3).

Loans held-for-sale, net. Consists of originated loans that are generally expected to be transferred or sold within 60 days to 180 days of loan funding, and are valued using pricing models that incorporate observable inputs from current market assumptions or a hypothetical securitization model utilizing observable market data from recent securitization spreads and observable pricing of loans with similar characteristics (Level 2). Fair value includes the fair value allocated to the associated future MSRs and is calculated pursuant to the valuation techniques described below for capitalized mortgage servicing rights, net (Level 3).

Capitalized mortgage servicing rights, net. Fair values are estimated using inputs based on discounted future net cash flow methodology (Level 3). The fair value of MSRs is estimated using a process that involves the use of independent third-party valuation experts, supported by commercially available discounted cash flow models and analysis of current market data. The key inputs used in estimating fair value include the contractually specified servicing fees, prepayment speed of the underlying loans, discount rate, annual per loan cost to service loans, delinquency rates, late charges and other economic factors.

Securities held-to-maturity, net. Fair values are approximated using inputs based on current market quotes received from financial sources that trade such securities and are based on prevailing market data and, in some cases, are derived from third-party proprietary models based on well recognized financial principles and reasonable estimates about relevant future market conditions (Level 3).

Derivative financial instruments. Fair values of rate lock and forward sale commitments are estimated using valuation techniques, which include internally-developed models developed based on changes in the U.S. Treasury rate and other observable market data (Level 2). The fair value of rate lock commitments includes the fair value of the expected net cash flows associated with the servicing of the loans, see capitalized mortgage servicing rights, net above for details on the applicable valuation technique (Level 3). We also consider the impact of counterparty non-performance risk when measuring the fair value of these derivatives. Given the credit quality of our counterparties, the short duration of interest rate lock commitments and forward sale contracts, and our historical experience, the risk of nonperformance by our counterparties is not significant.

Credit and repurchase facilities. Fair values for credit and repurchase facilities of the Structured Business are estimated using discounted cash flow methodology, using discount rates, which, in our opinion, best reflect current market interest rates for financing with similar characteristics and credit quality (Level 3). The majority of our credit and repurchase facilities for the Agency Business bear interest at rates that are similar to those available in the market currently and fair values are estimated using Level 2 inputs. For these facilities, the fair values approximate their carrying values.

Securitized debt and junior subordinated notes. Fair values are estimated based on broker quotations, representing the discounted expected future cash flows at a yield that reflects current market interest rates and credit spreads (Level 3).

Senior unsecured notes. Fair values are estimated at current market quotes received from active markets when available (Level 1). If quotes from active markets are unavailable, then the fair values are estimated utilizing current market quotes received from inactive markets (Level 2).

Convertible senior unsecured notes. Fair values are estimated using current market quotes received from inactive markets (Level 2).

We measure certain financial assets and financial liabilities at fair value on a recurring basis. The fair values of these financial assets and liabilities are determined using the following input levels at September 30, 2023 (in thousands):

	Carrying Value		Fair Value		Fair Value Measurements Using Fair Value Hierarchy
					Level 1		Level 2		Level 3
Financial assets:
Derivative financial instruments	$	3,341	$	3,341	$	—	$	2,379	$	962
Financial liabilities:
Derivative financial instruments	$	8,161	$	8,161	$	—	$	8,161	$	—

We measure certain financial and non-financial assets at fair value on a nonrecurring basis. The fair values of these financial and non-financial assets, if applicable, are determined using the following input levels at September 30, 2023 (in thousands):

	Net Carrying Value		Fair Value		Fair Value Measurements Using Fair Value Hierarchy
					Level 1		Level 2		Level 3
Financial assets:
Impaired loans, net
Loans held-for-investment (1)	$	169,171	$	169,171	$	—	$	—	$	169,171
Loans held-for-sale (2)	17,169		17,169		—		17,169		—
	$	186,340	$	186,340	$	—	$	17,169	$	169,171

________________________

(1)We had an allowance for credit losses of $111.1 million relating to thirteen impaired loans with an aggregate carrying value, before loan loss reserves, of $280.3 million at September 30, 2023.

(2)We had unrealized impairment losses of $2.9 million related to six held-for-sale loans with an aggregate carrying value, before unrealized impairment losses, of $20.1 million.

Loan impairment assessments. Loans held-for-investment are intended to be held to maturity and, accordingly, are carried at cost, net of unamortized loan origination costs and fees, loan purchase discounts, and net of the allowance for credit losses, when such loan or investment is deemed to be impaired. We consider a loan impaired when, based upon current information, it is probable that all amounts due for both principal and interest will not be collected according to the contractual terms of the loan agreement. We evaluate our loans to determine if the value of the underlying collateral securing the impaired loan is less than the net carrying value of the loan, which may result in an allowance, and corresponding charge to the provision for credit losses, or an impairment loss. These valuations require significant judgments, which include assumptions regarding capitalization and discount rates, revenue growth rates, creditworthiness of major tenants, occupancy rates, availability of financing, exit plan and other factors.

Loans held-for-sale are generally transferred and sold within 60-180 days of loan origination and are reported at lower of cost or market. We consider a loan classified as held-for-sale impaired if, based on current information, it is probable that we will sell the loan below par, or not be able to collect all principal and interest in accordance with the contractual terms of the loan agreement. These loans are valued using pricing models that incorporate observable inputs from current market assumptions or a hypothetical securitization model utilizing observable market data from recent securitization spreads and observable pricing of loans with similar characteristics.

The tables above and below include all impaired loans, regardless of the period in which the impairment was recognized.

Quantitative information about Level 3 fair value measurements at September 30, 2023 is as follows ($ in thousands):

	Fair Value		Valuation Techniques	Significant Unobservable Inputs
Financial assets:
Impaired loans:
Multifamily	$	70,246	Discounted cash flows	Capitalization rate	6.53	%
Land	50,000		Discounted cash flows	Discount rate	21.50	%
				Revenue growth rate	3.00	%
				Discount rate	7.50	%
Office	37,074		Discounted cash flows	Capitalization rate	5.25	%
				Revenue growth rate	3.00	%
				Discount rate	11.25	%
Retail	11,851		Discounted cash flows	Capitalization rate	9.25	%
				Revenue growth rate	3.00	%
Derivative financial instruments:
Rate lock commitments	962		Discounted cash flows	W/A discount rate	12.27	%

The derivative financial instruments using Level 3 inputs are outstanding for short periods of time (generally less than 60 days). A roll-forward of Level 3 derivative instruments is as follows (in thousands):

	Fair Value Measurements Using Significant Unobservable Inputs
	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Derivative assets and liabilities, net
Beginning balance	$	757	$	1,035	$	354	$	295
Settlements	(13,369)		(16,554)		(46,123)		(47,491)
Realized gains recorded in earnings	12,612		15,519		45,769		47,196
Unrealized gains recorded in earnings	962		1,554		962		1,554
Ending balance	$	962	$	1,554	$	962	$	1,554

The components of fair value and other relevant information associated with our rate lock commitments, forward sales commitments and the estimated fair value of cash flows from servicing on loans held-for-sale are as follows (in thousands):

September 30, 2023	Notional/ Principal Amount		Fair Value of Servicing Rights		Interest Rate Movement Effect		Unrealized Impairment Loss		Total Fair Value Adjustment
Rate lock commitments	$	107,093	$	962	$	(2,339)	$	—	$	(1,377)
Forward sale commitments	455,363		—		2,339		—		2,339
Loans held-for-sale, net (1)	368,330		4,302		—		(2,891)		1,411
Total			$	5,264	$	—	$	(2,891)	$	2,373

________________________

(1)Loans held-for-sale, net are recorded at the lower of cost or market on an aggregate basis and includes fair value adjustments related to estimated cash flows from MSRs.

We measure certain assets and liabilities for which fair value is only disclosed. The fair value of these assets and liabilities are determined using the following input levels at September 30, 2023 (in thousands):

					Fair Value Measurements Using Fair Value Hierarchy
	Carrying Value		Fair Value		Level 1		Level 2		Level 3
Financial assets:
Loans and investments, net	$	12,892,796	$	12,911,172	$	—	$	—	$	12,911,172
Loans held-for-sale, net	364,320		374,534		—		370,232		4,302
Capitalized mortgage servicing rights, net	392,203		538,078		—		—		538,078
Securities held-to-maturity, net	155,172		126,608		—		—		126,608
Financial liabilities:
Credit and repurchase facilities	$	3,391,441	$	3,382,933	$	—	$	354,586	$	3,028,347
Securitized debt	7,004,634		6,899,147		—		—		6,899,147
Senior unsecured notes	1,332,926		1,211,633		1,211,633		—		—
Convertible senior unsecured notes	282,428		290,019		—		290,019		—
Junior subordinated notes	143,695		105,821		—		—		105,821

XML

Commitments and Contingencies

9 Months Ended

Sep. 30, 2023

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Agency Business Commitments. Our Agency Business is subject to supervision by certain regulatory agencies. Among other things, these agencies require us to meet certain minimum net worth, operational liquidity and restricted liquidity collateral requirements, and compliance with reporting requirements. Our adjusted net worth and liquidity required by the agencies for all periods presented exceeded these requirements.

At September 30, 2023, we were required to maintain at least $19.8 million of liquid assets in one of our subsidiaries to meet our operational liquidity requirements for Fannie Mae and we had operational liquidity in excess of this requirement.

We are generally required to share the risk of any losses associated with loans sold under the Fannie Mae DUS program and are required to secure this obligation by assigning restricted cash balances and/or a letter of credit to Fannie Mae. The amount of collateral required by Fannie Mae is a formulaic calculation at the loan level by a Fannie Mae assigned tier, which considers the loan balance, risk level of the loan, age of the loan and level of risk-sharing. Fannie Mae requires restricted liquidity for Tier 2 loans of 75 basis points, 15 basis points for Tier 3 loans and 5 basis points for Tier 4 loans, which is funded over a 48-month period that begins upon delivery of the loan to Fannie Mae. A significant portion of our Fannie Mae DUS serviced loans for which we have risk sharing are Tier 2 loans. At September 30, 2023, the restricted liquidity requirement totaled $72.6 million and was satisfied with a $64.0 million letter of credit and cash issued to Fannie Mae.

At September 30, 2023, reserve requirements for the Fannie Mae DUS loan portfolio will require us to fund $37.3 million in additional restricted liquidity over the next 48 months, assuming no further principal paydowns, prepayments, or defaults within our at-risk portfolio. Fannie Mae periodically reassesses these collateral requirements and may make changes to these requirements in the future. We generate sufficient cash flow from our operations to meet these capital standards and do not expect any changes to have a material impact on our future operations; however, future changes to collateral requirements may adversely impact our available cash.

We are subject to various capital requirements in connection with seller/servicer agreements that we have entered into with secondary market investors. Failure to maintain minimum capital requirements could result in our inability to originate and service loans for the respective investor and, therefore, could have a direct material effect on our consolidated financial statements. At September 30, 2023, we met all of Fannie Mae’s quarterly capital requirements and our Fannie Mae adjusted net worth was in excess of the required net worth. We are not subject to capital requirements on a quarterly basis for Ginnie Mae and FHA, as requirements for these investors are only required on an annual basis.

As an approved designated seller/servicer under Freddie Mac’s SBL program, we are required to post collateral to ensure that we are able to meet certain purchase and loss obligations required by this program. Under the SBL program, we are required to post collateral equal to $5.0 million, which is satisfied with a $5.0 million letter of credit.

We enter into contractual commitments with borrowers providing rate lock commitments while simultaneously entering into forward sale commitments with investors. These commitments are outstanding for short periods of time (generally less than 60 days) and are described in more detail in Note 11 and Note 12.

Debt Obligations and Operating Leases. At September 30, 2023, the maturities of our debt obligations and the minimum annual operating lease payments under leases with a term in excess of one year are as follows (in thousands):

Year	Debt Obligations		Minimum Annual Operating Lease Payments		Total
2023 (three months ending December 31, 2023)	$	858,768	$	2,300	$	861,068
2024	2,004,350		10,188		2,014,538
2025	3,378,563		10,555		3,389,118
2026	4,523,241		10,627		4,533,868
2027	1,115,231		9,225		1,124,456
2028	180,000		8,624		188,624
Thereafter	154,336		27,755		182,091
Total	$	12,214,489	$	79,274	$	12,293,763

During the three and nine months ended September 30, 2023 and the three and nine months ended September 30, 2022, we recorded lease expense of $2.8 million, $8.0 million, $2.4 million and $7.2 million, respectively.

Unfunded Commitments. In accordance with certain structured loans and investments, we have outstanding unfunded commitments of $1.08 billion at September 30, 2023 that we are obligated to fund as borrowers meet certain requirements. Specific requirements include, but are not limited to, property renovations, building construction and conversions based on criteria met by the borrower in accordance with the loan agreements.

Litigation. We are subject to a variety of claims and suits that arise from time to time in the ordinary course of our business. Although management currently believes that resolving claims against us, individually or in aggregate, will not have a material adverse impact in our consolidated financial statements, these matters are subject to inherent uncertainties and management’s view of these matters may change in the future. Other than the litigation noted below, we are currently neither subject to any material litigation nor, to the best of our knowledge, threatened by any material litigation.

In June 2011, three related lawsuits were filed by the Extended Stay Litigation Trust (the “Trust”), a post-bankruptcy litigation trust alleged to have standing to pursue claims that previously had been held by Extended Stay, Inc. and the Homestead Village L.L.C. family of companies that had emerged from bankruptcy. There were 73 defendants in the three lawsuits, including 55 corporate and partnership entities and 18 individuals. A subsidiary of ours and certain individuals and other entities that are affiliates of ours were included as defendants.

In June 2013, the Trust amended the lawsuits, to, among other things, (1) consolidate the lawsuits into one lawsuit, (2) remove 47 defendants from the lawsuits, none of whom were related to us, so that there were 26 remaining defendants, including 16 corporate and partnership entities and 10 individuals, and (3) reduce the counts within the lawsuits from over 100 down to 17 (as consolidated, the "Action"). For more detailed information regarding the Action, please refer to Note 14 of our 2022 Annual Report.

After extensive motion practice and discovery, in early December 2022, the plaintiff and certain co-defendants, including our affiliates, commenced discussions regarding a possible settlement of the Action, and in late December 2022, those parties reached an agreement in principle to settle the Action for a total of $38.0 million. We agreed to pay up to $7.4 million of the settlement amount, which amount was accrued in our December 31, 2022 financial statements.

In early March 2023, the parties to the settlement finalized the settlement documents and on April 25, 2023, the Bankruptcy Court approved the settlement in open court. Following the Bankruptcy Court approval, the parties made the agreed upon payments, the broad mutual releases became effective and on June 23, 2023, the litigation was discontinued, with prejudice.

Due to Borrowers. Due to borrowers represents borrowers’ funds held by us to fund certain expenditures or to be released at our discretion upon the occurrence of certain pre-specified events, and to serve as additional collateral for borrowers’ loans. While retained, these balances earn interest in accordance with the specific loan terms they are associated with.

XML

Variable Interest Entities

9 Months Ended

Sep. 30, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Variable Interest Entities

Variable Interest Entities

Our involvement with VIEs primarily affects our financial performance and cash flows through amounts recorded in interest income, interest expense, provision for loan losses and through activity associated with our derivative instruments.

Consolidated VIEs. We have determined that our operating partnership, ARLP, and our CLO and Q Series securitization entities (“Securitization Entities”) are VIEs, which we consolidate. ARLP was already consolidated in our financial statements, therefore, the identification of this entity as a VIE had no impact on our consolidated financial statements.

Our Securitization Entities invest in real estate and real estate-related securities and are financed by the issuance of debt securities. We believe we hold the power necessary to direct the most significant economic activities of those entities. We also have exposure to losses to the extent of our equity interests and rights to waterfall payments in excess of required payments to bond investors. As a result of consolidation, equity interests have been eliminated, and the consolidated balance sheets reflect both the assets held and debt issued to third parties by the Securitization Entities, prior to the unwind. Our operating results and cash flows include the gross asset and liability amounts related to the Securitization Entities as opposed to our net economic interests in those entities.

The assets and liabilities related to these consolidated Securitization Entities are as follows (in thousands):

	September 30, 2023		December 31, 2022
Assets:
Restricted cash	$	408,569	$	710,775
Loans and investments, net	7,968,741		8,900,104
Other assets	311,988		174,382
Total assets	$	8,689,298	$	9,785,261
Liabilities:
Securitized debt	$	7,004,634	$	7,849,270
Other liabilities	23,259		26,754
Total liabilities	$	7,027,893	$	7,876,024

Assets held by the Securitization Entities are restricted and can only be used to settle obligations of those entities. The liabilities of the Securitization Entities are non-recourse to us and can only be satisfied from each respective asset pool. See Note 9 for details. We are not obligated to provide, have not provided, and do not intend to provide financial support to any of the Securitization Entities.

Unconsolidated VIEs. We determined that we are not the primary beneficiary of 27 VIEs in which we have a variable interest at September 30, 2023 because we do not have the ability to direct the activities of the VIEs that most significantly impact each entity’s economic performance.

A summary of our variable interests in identified VIEs, of which we are not the primary beneficiary, at September 30, 2023 is as follows (in thousands):

Type	Carrying Amount (1)
Loans	$	433,532
APL certificates	129,887
B Piece bonds	31,228
Equity investments	17,771
Agency interest only strips	177
Total	$	612,595

________________________

(1)Represents the carrying amount of loans and investments before reserves. At September 30, 2023, $172.9 million of loans to VIEs had corresponding specific loan loss reserves of $85.8 million. The maximum loss exposure at September 30, 2023 would not exceed the carrying amount of our investment.

These unconsolidated VIEs have exposure to real estate debt of approximately $3.86 billion at September 30, 2023.

XML

Equity

9 Months Ended

Sep. 30, 2023

Stockholders' Equity Note [Abstract]

Equity

Equity

Common Stock. During the nine months ended September 30, 2023, we sold 13,113,296 shares of our common stock at an average price of $14.77 per share for net proceeds of $193.6 million through an “At-The-Market” equity offering sales agreement. The proceeds were used to make investments related to our business and for general corporate purposes.

In March 2023, the Board of Directors authorized a share repurchase program providing for the repurchase of up to $50.0 million of our outstanding common stock. The repurchase of our common stock may be made from time to time in the open market, through privately negotiated transactions, or otherwise in compliance with Rule 10b-18 and Rule 10b5-1 under the Securities Exchange Act of 1934, based on our stock price, general market conditions, applicable legal requirements and other factors. The program may be discontinued or modified at any time. At September 30, 2023, we repurchased 3,545,604 shares of our common stock under this program at a total cost of $37.4 million and an average cost of $10.56 per share.

Noncontrolling Interest. Noncontrolling interest relates to the operating partnership units (“OP Units”) issued to satisfy a portion of the purchase price in connection with the acquisition of the agency platform of Arbor Commercial Mortgage, LLC (“ACM”) in 2016. Each of these OP Units are paired with one share of our special voting preferred shares having a par value of $0.01 per share and is entitled to one vote each on any matter submitted for stockholder approval. The OP Units are entitled to receive distributions if and when our Board of Directors authorizes and declares common stock distributions. The OP Units are also redeemable for cash, or at our option, for shares of our common stock on a one-for-one basis. At September 30, 2023, there were 16,293,589 OP Units outstanding, which represented 8.0% of the voting power of our outstanding stock.

Distributions. Dividends declared (on a per share basis) during the nine months ended September 30, 2023 are as follows:

Common Stock			Preferred Stock
				Dividend
Declaration Date	Dividend		Declaration Date	Series D		Series E		Series F
February 15, 2023	$	0.40	January 3, 2023	$	0.3984375	$	0.390625	$	0.390625
May 3, 2023	$	0.42	March 31, 2023	$	0.3984375	$	0.390625	$	0.390625
July 26, 2023	$	0.43	June 30, 2023	$	0.3984375	$	0.390625	$	0.390625
			September 29, 2023	$	0.3984375	$	0.390625	$	0.390625

Common Stock – On October 25, 2023, the Board of Directors declared a cash dividend of $0.43 per share of common stock. The dividend is payable on November 30, 2023 to common stockholders of record as of the close of business on November 17, 2023.

Deferred Compensation. During 2023, we issued 939,325 shares of restricted common stock to our employees and Board of Directors under the 2020 Amended Omnibus Stock Incentive Plan (the “2020 Plan”) with a total grant date fair value of $11.2 million, of which: (1) 297,182 shares with a grant date fair value of $3.6 million vested on the grant date in 2023; (2) 276,785 shares with a grant date fair value of $3.3 million will vest in 2024; (3) 252,510 shares with a grant date fair value of $3.0 million will vest in 2025; (4) 78,126 shares with a grant date fair value of $0.9 million will vest in 2026; and (5) 34,722 shares with a grant date fair value of $0.4 million will vest in 2027. We also issued 40,796 fully vested restricted stock units (“RSUs”) with a grant date fair value of $0.5 million to certain members of our Board of Directors and 247,275 RSUs with a grant date fair value of $2.9 million that vest in full in the first quarter of 2026 to our chief executive officer. The individuals decided to defer the receipt of the common stock, to which the RSUs are converted into, to a future date pursuant to a pre-established deferral election.

During the first and third quarters of 2023, 352,427 shares of performance-based restricted stock units and 313,152 shares of restricted common stock, respectively, previously granted to our chief executive officer fully vested and were net settled for 172,513 and 153,287 common shares, respectively.

During 2023, we withheld 220,315 shares from the net settlement of restricted common stock by employees for payment of withholding taxes on shares that vested.

Earnings Per Share (“EPS”). Basic EPS is calculated by dividing net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding during each period inclusive of unvested restricted stock with full dividend participation rights. Diluted EPS is calculated by dividing net income (loss) by the weighted average number of shares of common stock outstanding, plus the additional dilutive effect of common stock equivalents during each period. Our common stock equivalents include the weighted average dilutive effect of restricted stock units granted to our chief executive officer, OP Units and convertible senior unsecured notes.

A reconciliation of the numerator and denominator of our basic and diluted EPS computations is as follows ($ in thousands, except share and per share data):

	Three Months Ended September 30,
	2023				2022
	Basic		Diluted		Basic		Diluted
Net income attributable to common stockholders (1)	$	77,924	$	77,924	$	62,710	$	62,710
Net income attributable to noncontrolling interest (2)	—		6,789		—		6,002
Interest expense on convertible notes	—		6,081		—		5,797
Net income attributable to common stockholders and noncontrolling interest	$	77,924	$	90,794	$	62,710	$	74,509
Weighted average shares outstanding	187,023,395		187,023,395		170,227,553		170,227,553
Dilutive effect of OP Units (2)	—		16,293,589		—		16,293,589
Dilutive effect of convertible notes	—		17,312,382		—		18,815,399
Dilutive effect of restricted stock units (3)	—		699,452		—		528,475
Weighted average shares outstanding	187,023,395		221,328,818		170,227,553		205,865,016
Net income per common share (1)	$	0.42	$	0.41	$	0.37	$	0.36
	Nine Months Ended September 30,
	2023				2022
Net income attributable to common stockholders (1)	$	238,407	$	238,407	$	196,678	$	196,678
Net income attributable to noncontrolling interest (2)	—		21,200		—		19,811
Interest expense on convertible notes	—		18,244		—		13,786
Net income attributable to common stockholders and noncontrolling interest	$	238,407	$	277,851	$	196,678	$	230,275
Weighted average shares outstanding	183,340,149		183,340,149		162,292,235		162,292,235
Dilutive effect of OP Units (2)	—		16,293,589		—		16,308,361
Dilutive effect of convertible notes	—		17,271,419		—		16,370,528
Dilutive effect of restricted stock units (3)	—		552,242		—		558,216
Weighted average shares outstanding	183,340,149		217,457,399		162,292,235		195,529,340
Net income per common share (1)	$	1.30	$	1.28	$	1.21	$	1.18

________________________

(1)Net of preferred stock dividends.

(2)We consider OP Units to be common stock equivalents as the holders have voting rights, the right to distributions and the right to redeem the OP Units for the cash value of a corresponding number of shares of common stock or a corresponding number of shares of common stock, at our election.

(3)Our chief executive officer was granted restricted stock units, which vest at the end of a four-year performance period based upon our achievement of total stockholder return objectives.

XML

Income Taxes

9 Months Ended

Sep. 30, 2023

Income Tax Disclosure [Abstract]

Income Taxes

Income TaxesAs a REIT, we are generally not subject to U.S. federal income tax to the extent of our distributions to stockholders and as long as certain asset, income, distribution, ownership and administrative tests are met. To maintain our qualification as a REIT, we must annually distribute at least 90% of our REIT-taxable income to our stockholders and meet certain other requirements. We may also be subject to certain state, local and franchise taxes. Under certain circumstances, federal income and excise taxes may be due on our undistributed taxable income. If we were to fail to meet these requirements, we would be subject to U.S. federal income tax, which could have a material adverse impact on our results of operations and amounts available for distributions to our stockholders. We believe that all of the criteria to maintain our REIT qualification have been met for the applicable periods, but there can be no assurance that these criteria will continue to be met in subsequent periods.

The Agency Business is operated through our TRS Consolidated Group and is subject to U.S. federal, state and local income taxes. In general, our TRS entities may hold assets that the REIT cannot hold directly and may engage in real estate or non-real estate-related business.

In the three and nine months ended September 30, 2023, we recorded a tax provision of $5.9 million and $19.4 million, respectively. In the three and nine months ended September 30, 2022, we recorded a tax benefit of $0.4 million and a tax provision of $13.2 million. The tax provision recorded in the three months ended September 30, 2023 consisted of a current tax provision of $8.3 million and a deferred tax benefit of $2.4 million. The tax provision recorded in the nine months ended September 30, 2023 consisted of a current tax provision of $26.0 million and a deferred tax benefit of $6.6 million. The tax benefit recorded in the three months ended September 30, 2022 consisted of a current tax provision of $5.0 million and a deferred tax benefit of $5.4 million. The tax provision recorded in the nine months ended September 30, 2022 consisted of a current tax provision of $21.0 million and a deferred tax benefit of $7.8 million. Current and deferred taxes are primarily recorded on the portion of earnings (losses) recognized by us with respect to our interest in the TRS’s. Deferred income tax assets and liabilities are calculated based on temporary differences between our U.S. GAAP consolidated financial statements and the federal, state, local tax basis of assets and liabilities as of the consolidated balance sheets.

XML

Agreements and Transactions with Related Parties

9 Months Ended

Sep. 30, 2023

Related Party Transactions [Abstract]

Agreements and Transactions with Related Parties

Agreements and Transactions with Related Parties

Support Agreement and Employee Secondment Agreement. We have a support agreement and a secondment agreement with ACM and certain of its affiliates and certain affiliates of a relative of our chief executive officer (“Service Recipients”) where we provide support services and seconded employees to the Service Recipients. The Service Recipients reimburse us for the costs of performing such services and the cost of the seconded employees. During the three and nine months ended September 30, 2023, we incurred $0.9 million and $2.3 million, respectively, and, during the three and nine months ended September 30, 2022, we incurred $0.9 million and $2.5 million, respectively, of costs for services provided and employees seconded to the Service Recipients, which is included in due from related party on the consolidated balance sheets. These costs were reimbursed to us subsequent to period end.

Other Related Party Transactions. Due from related party was $211.7 million and $77.4 million at September 30, 2023 and December 31, 2022, respectively, which consisted primarily of amounts due from our affiliated servicing operations related to real estate transactions closing at the end of the quarter and amounts due from ACM for costs incurred in connection with the support and secondment agreements described above.

Due to related party was $2.2 million and $12.4 million at September 30, 2023 and December 31, 2022, respectively, and consisted of loan payoffs, holdbacks and escrows to be remitted to our affiliated servicing operations related to real estate transactions.

In certain instances, our business requires our executives to charter privately owned aircraft in furtherance of our business. We have an aircraft time-sharing agreement with an entity controlled by our chief executive officer that owns a private aircraft. Pursuant to the agreement, we reimburse the aircraft owner for the required costs under Federal Aviation Administration regulations for the flights our executives’ charter. During the nine months ended September 30, 2023 and 2022, we reimbursed the aircraft owner $0.6 million and $1.0 million, respectively, for the flights chartered by our executives pursuant the agreement.

In May 2023, we committed to fund a $56.9 million bridge loan ($3.8 million was funded at September 30, 2023) for an SFR build-to-rent construction project. Two of our officers have made minority equity investments totaling $0.5 million, representing approximately 4.0% of the total equity invested in the project. The loan has an interest rate of SOFR plus 5.50% with a SOFR floor of 3.25% and matures in December 2025, with two six-month extension options. Interest income recorded from this loan was $0.1 million and $0.2 million for the three and nine months ended September 30, 2023, respectively.

In July 2022, we purchased a $46.2 million bridge loan originated by ACM at par ($3.5 million was funded at September 30, 2023) for an SFR build-to-rent construction project. A consortium of investors (which includes, among other unaffiliated investors, certain of our officers with a minority ownership interest) owns 70% of the borrowing entity and an entity indirectly owned and controlled by an immediate family member of our chief executive officer owns 10% of the borrowing entity. The loan has an interest rate of SOFR plus 5.5% and matures in March 2025. Interest income recorded from this loan was $0.1 million for both the three and nine months ended September 30, 2023.

In April 2022, we committed to fund a $67.1 million bridge loan (none of which was funded at September 30, 2023) in an SFR build-to-rent construction project. An entity owned by an immediate family member of our chief executive officer also made an equity investment in the project and owns a 2.25% equity interest in the borrowing entity. The loan has an interest rate of SOFR plus 4.63% with a SOFR floor of 0.25% and matures in May 2025. Interest income recorded from this loan was $0.1 million and $0.2 million for the three and nine months ended September 30, 2023, respectively, and less than $0.1 million and $0.1 million for the three and nine months ended September 30, 2022, respectively.

In February 2022, we committed to fund a $39.4 million bridge loan ($3.1 million was funded at September 30, 2023) in an SFR build-to-rent construction project. An entity owned by an immediate family member of our chief executive officer also made an equity investment in the project and owns a 2.25% equity interest in the borrowing entity. The loan had an interest rate of LIBOR plus 4.0% with a LIBOR floor of 0.25% and matures in March 2025. On July 1, 2023, the interest rate was changed to SOFR plus 4.0% with a SOFR floor of 0.25%. Interest income recorded from this loan was less than $0.1 million for both the three months ended September 30, 2023 and 2022, and $0.1 million for both the nine months ended September 30, 2023 and 2022.

In 2021, we invested $4.2 million for 49.3% interest in a limited liability company (“LLC”) which purchased a retail property for $32.5 million and assumed an existing $26.0 million CMBS loan. A portion of the property can potentially be converted to office space, of which we have the right to occupy, in part. An entity owned by an immediate family member of our chief executive officer also made an investment in the LLC for a 10.0% ownership, is the managing member and holds the right to purchase our interest in the LLC.

In 2021, we originated a $63.4 million bridge loan to a third party to purchase a multifamily property from a multifamily-focused commercial real estate investment fund sponsored and managed by our chief executive officer and one of his immediate family members, which fund has no continued involvement with the property following the purchase. The loan had an interest rate of LIBOR plus 3.75% with a LIBOR floor of 0.25% and matures in March 2024. On July 1, 2023, the interest rate was changed to SOFR plus 3.75% with a SOFR floor of 0.25%. Interest income recorded from this loan was $1.5 million and $4.3 million for the three and nine months ended September 30, 2023, respectively, and $1.0 million and $2.5 million for the three and nine months ended September 30, 2022, respectively.

In 2020, we committed to fund a $32.5 million bridge loan ($24.5 million was funded at September 30, 2023) and made a $3.5 million preferred equity investment in an SFR build-to-rent construction project. An entity owned by an immediate family member of our chief executive officer also made an equity investment in the project and owns a 21.8% equity interest in the borrowing entity. The bridge loan had an interest rate of LIBOR plus 5.5% with a LIBOR floor of 0.75%, the preferred equity investment has a 12.0% fixed rate, and both loans mature in December 2023. On July 1, 2023, the bridge loan interest rate was changed to SOFR plus 5.5% with a SOFR floor of 0.75%. Interest income recorded from these loans was $0.8 million and $2.0 million for the three and nine months ended September 30, 2023, respectively, and $0.3 million and $0.8 million for the three and nine months ended September 30, 2022, respectively.

In 2020, we committed to fund a $30.5 million bridge loan and we made a $4.6 million preferred equity investment in a SFR build-to-rent construction project. ACM and an entity owned by an immediate family member of our chief executive officer also made equity investments in the project and own an 18.9% equity interest in the borrowing entity. The bridge loan had an interest rate of LIBOR plus 5.5% with a LIBOR floor of 0.75% and was scheduled to mature in May 2023 and the preferred equity investment has a 12.0% fixed rate and was scheduled to mature in April 2023. In April 2023, the bridge loan was upsized to a maximum of $38.4 million ($34.2 million was funded at September 30, 2023), and the interest rate was changed to SOFR plus 5.25% with a SOFR floor of 1.00%. In addition, the maturity on both loans was extended to May 2025. Interest income recorded from these loans was $1.0 million and $2.5 million for the three and nine months ended September 30, 2023, respectively, and $0.5 million and $1.0 million for the three and nine months ended September 30, 2022, respectively.

In 2020, we originated a $14.8 million Private Label loan and a $3.4 million mezzanine loan on two multifamily properties owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns a 50% interest in the borrowing entity. In 2020, we sold the Private Label loan to an unconsolidated affiliate of ours. The mezzanine loan bears interest at a 9.0% fixed rate and matures in April 2030. Interest income recorded from the mezzanine loan was $0.1 million for both the three months ended September 30, 2023 and 2022, and $0.2 million for both the nine months ended September 30, 2023 and 2022.

We have a $35.0 million bridge loan and a $10.0 million preferred equity interest on an office building. The bridge loan was scheduled to mature in July 2023 and was extended to October 30, 2023 and the preferred equity investment matures in June 2027. The property is controlled by a third party. The day-to-day operations are currently being managed by an immediate family member, or one of his affiliated entities, of our chief executive officer. In 2021, we entered into a forbearance agreement with the borrower on the outstanding bridge loan to defer all interest owed until maturity or early payoff. At both September 30, 2023 and December 31, 2022, these loans had an allowance for credit loss recorded against them totaling $8.0 million.

In 2019, we, along with ACM, certain executives of ours and a consortium of independent outside investors, formed AMAC III, a multifamily-focused commercial real estate investment fund sponsored and managed by our chief executive officer and one of his immediate family members. We committed to a $30.0 million investment ($25.2 million was funded at September 30, 2023) for an 18% interest in AMAC III. During the three and nine months ended September 30, 2023, we recorded losses associated with this investment of $0.7 million and $1.6 million, respectively, and during the nine months ended September 30, 2023, we received cash distributions of $1.1 million. During the three and nine months ended September 30, 2022, we recorded a loss associated with this investment of $0.7 million and $1.8 million, respectively, and we received distributions of $0.2 million and $0.4 million, respectively. In 2019, AMAC III originated

a $7.0 million mezzanine loan to a borrower with which we have an outstanding $34.0 million bridge loan. In 2020, for full satisfaction of the mezzanine loan, AMAC III became the owner of the property. Also in 2020, the $34.0 million bridge loan was refinanced with a $35.4 million bridge loan, which bore interest at a rate of LIBOR plus 3.5% and was scheduled to mature in August 2023, which was extended to August 2024. On July 1, 2023, the bridge loan interest rate was changed to SOFR plus 3.5%. Interest income recorded from the bridge loan was $0.8 million and $2.3 million for the three and nine months ended September 30, 2023, respectively, and $0.5 million and $1.2 million for the three and nine months ended September 30, 2022, respectively.

In 2018, we originated a $21.7 million bridge loan on a multifamily property owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns 75% in the borrowing entity. The loan had an interest rate of LIBOR plus 4.75% with a LIBOR floor of 0.25% and was scheduled to mature in August 2023, which was extended to August 2024. In addition, on July 1, 2023, the interest rate was changed to SOFR plus 4.75% with a SOFR floor of 0.25%. Interest income recorded from this loan was $0.6 million and $1.6 million for the three and nine months ended September 30, 2023, respectively, and $0.4 million and $1.0 million for the three and nine months ended September 30, 2022, respectively.

In 2017, we originated two bridge loans totaling $28.0 million on two multifamily properties owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns 45% of the borrowing entity. The loans had an interest rate of LIBOR plus 5.25% with LIBOR floors ranging from 1.24% to 1.54% and were scheduled to mature in 2020. The borrower refinanced these loans with a $31.1 million bridge loan we originated in 2019 with an interest rate of LIBOR plus 4.0%, a LIBOR floor of 1.8%, which was scheduled to mature in October 2022. In May 2022, this loan paid off in full. Interest income recorded from this loan was $0.8 million for the nine months ended September 30, 2022.

In 2017, we originated a $46.9 million Fannie Mae loan on a multifamily property owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers) which owns a 17.6% interest in the borrowing entity. We carry a maximum loss-sharing obligation with Fannie Mae on this loan of up to 5% of the original UPB. Servicing revenue recorded from this loan was less than $0.1 million for all periods presented.

In 2017, Ginkgo Investment Company LLC (“Ginkgo”), of which one of our directors is a 33% managing member, purchased a multifamily apartment complex which assumed an existing $8.3 million Fannie Mae loan that we service. Ginkgo subsequently sold the majority of its interest in this property and owned a 3.6% interest at September 30, 2023. We carried a maximum loss-sharing obligation with Fannie Mae on this loan of up to 20% of the original UPB. Upon the sale, we received a 1% loan assumption fee which was governed by existing loan agreements that were in place when the loan was originated in 2015, prior to such purchase. In July 2023, the Fannie Mae loan was paid off in full. Servicing revenue recorded from this loan was less than $0.1 million for all periods presented.

In 2016, we originated $48.0 million of bridge loans on six multifamily properties owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns interests ranging from 10.5% to 12% in the borrowing entities. The loans had an interest rate of LIBOR plus 4.5% with a LIBOR floor of 0.25% and were scheduled to mature in 2019. In 2017, a $6.8 million loan on one property paid off in full and in 2018 four additional loans totaling $28.3 million paid off in full. In 2019, $10.9 million of the $12.9 million remaining bridge loan paid off, with the $2.0 million remaining UPB converting to a mezzanine loan with a fixed interest rate of 10.0% and a January 2024 maturity. Interest income recorded from the mezzanine loan was $0.1 million for all periods presented.

In 2015, we invested $9.6 million for 50% of ACM’s indirect interest in a joint venture with a third party that was formed to invest in a residential mortgage banking business. At September 30, 2023, we had an indirect interest of 12.3% in this entity. We recorded a loss of $1.3 million and income of $1.3 million related to this investment in the three and nine months ended September 30, 2023, respectively, and income of $0.3 million and $6.4 million in the three and nine months ended September 30, 2022, respectively. During the three and nine months ended September 30, 2023, we received cash distributions of $7.5 million and $15.0 million, respectively, and during the three and nine months ended September 30, 2022, we received cash distributions of $7.3 million and $22.3 million, respectively, which were classified as returns of capital.

We, along with an executive officer of ours and a consortium of independent outside investors, hold equity investments in a portfolio of multifamily properties referred to as the “Lexford” portfolio, which is managed by an entity owned primarily by a consortium of affiliated investors, including our chief executive officer and an executive officer of ours. Based on the terms of the management contract, the management company is entitled to 4.75% of gross revenues of the underlying properties, along with the potential to share in the proceeds of a sale or restructuring of the debt. In 2018, the owners of Lexford restructured part of its debt and we originated 12 bridge loans totaling $280.5 million, which were used to repay in full certain existing mortgage debt and to renovate 72 multifamily properties included in the portfolio. The loans were originated in 2018, had interest rates of LIBOR plus 4.0% and were scheduled to mature in June 2021. During 2019, the borrower made payoffs and partial paydowns of principal totaling $250.0 million and in 2020, the remaining balance of the loans were refinanced with a $34.6 million Private Label loan, which bears interest at a fixed rate of 3.3% and matures in March 2030. In 2020, we sold the Private Label loan to an unconsolidated affiliate of ours. Further, as part of this 2018 restructuring,

$50.0 million in unsecured financing was provided by an unsecured lender to certain parent entities of the property owners. ACM owns slightly less than half of the unsecured lender entity and, therefore, provided slightly less than half of the unsecured lender financing. In addition, in connection with our equity investment, we received distributions totaling $7.2 million during the nine months ended September 30, 2023, and $5.0 million and $11.0 million during the three and nine months ended September 30, 2022, respectively, which were recorded as income from equity affiliates. Separate from the loans we originated in 2018, we provide limited (“bad boy”) guarantees for certain other debt controlled by Lexford. The bad boy guarantees may become a liability for us upon standard “bad” acts such as fraud or a material misrepresentation by Lexford or us. At September 30, 2023, this debt had an aggregate outstanding balance of approximately $600.0 million and is scheduled to mature through 2029.

Several of our executives, including our chief financial officer, corporate secretary and our chairman, chief executive officer and president, hold similar positions for ACM. Our chief executive officer and his affiliated entities (“the Kaufman Entities”) together beneficially own approximately 35% of the outstanding membership interests of ACM and certain of our employees and directors also hold an ownership interest in ACM. Furthermore, one of our directors serves as the trustee and co-trustee of two of the Kaufman Entities that hold membership interests in ACM. At September 30, 2023, ACM holds 2,535,870 shares of our common stock and 10,615,085 OP Units, which represents 6.4% of the voting power of our outstanding stock. Our Board of Directors approved a resolution under our charter allowing our chief executive officer and ACM, (which our chief executive officer has a controlling equity interest in), to own more than the 5% ownership interest limit of our common stock as stated in our amended charter.

XML

Segment Information

9 Months Ended

Sep. 30, 2023

Segment Reporting [Abstract]

Segment Information

Segment Information

The summarized statements of income and balance sheet data, as well as certain other data, by segment are included in the following tables ($ in thousands). Specifically identifiable costs are recorded directly to each business segment. For items not specifically identifiable, costs have been allocated between the business segments using the most meaningful allocation methodologies, which was predominately direct labor costs (i.e., time spent working on each business segment). Such costs include, but are not limited to, compensation and employee related costs, selling and administrative expenses and stock-based compensation.

	Three Months Ended September 30, 2023
	Structured Business		Agency Business		Other / Eliminations (1)		Consolidated
Interest income	$	322,819	$	13,655	$	—	$	336,474
Interest expense	222,996		6,184		—		229,180
Net interest income	99,823		7,471		—		107,294
Other revenue:
Gain on sales, including fee-based services, net	—		18,619		—		18,619
Mortgage servicing rights	—		14,109		—		14,109
Servicing revenue	—		51,363		—		51,363
Amortization of MSRs	—		(15,900)		—		(15,900)
Property operating income	1,450		—		—		1,450
Loss on derivative instruments, net	—		(421)		—		(421)
Other income (loss), net	751		(578)		—		173
Total other revenue	2,201		67,192		—		69,393
Other expenses:
Employee compensation and benefits	12,912		26,898		—		39,810
Selling and administrative	5,291		7,076		—		12,367
Property operating expenses	1,479		—		—		1,479
Depreciation and amortization	1,114		1,172		—		2,286
Provision for loss sharing (net of recoveries)	—		1,679		—		1,679
Provision for credit losses (net of recoveries)	17,243		1,409		—		18,652
Total other expenses	38,039		38,234		—		76,273
Income before extinguishment of debt, income from equity affiliates and income taxes	63,985		36,429		—		100,414
Loss on extinguishment of debt	(314)		—		—		(314)
Income from equity affiliates	809		—		—		809
Provision for income taxes	1,078		(6,932)		—		(5,854)
Net income	65,558		29,497		—		95,055
Preferred stock dividends	10,342		—		—		10,342
Net income attributable to noncontrolling interest	—		—		6,789		6,789
Net income attributable to common stockholders	$	55,216	$	29,497	$	(6,789)	$	77,924

	Three Months Ended September 30, 2022
	Structured Business		Agency Business		Other / Eliminations (1)		Consolidated
Interest income	$	249,539	$	10,239	$	—	$	259,778
Interest expense	157,325		3,127		—		160,452
Net interest income	92,214		7,112		—		99,326
Other revenue:
Gain on sales, including fee-based services, net	—		14,360		—		14,360
Mortgage servicing rights	—		19,408		—		19,408
Servicing revenue	—		37,526		—		37,526
Amortization of MSRs	—		(14,782)		—		(14,782)
Property operating income	445		—		—		445
Loss on derivative instruments, net	—		(15,909)		—		(15,909)
Other income (loss), net	1,763		(7,777)		—		(6,014)
Total other revenue	2,208		32,826		—		35,034
Other expenses:
Employee compensation and benefits	13,342		25,469		—		38,811
Selling and administrative	5,961		7,264		—		13,225
Property operating expenses	366		—		—		366
Depreciation and amortization	906		1,172		—		2,078
Provision for loss sharing (net of recoveries)	—		412		—		412
Provision for credit losses (net of recoveries)	2,206		68		—		2,274
Total other expenses	22,781		34,385		—		57,166
Income before extinguishment of debt, income from equity affiliates and income taxes	71,641		5,553		—		77,194
Loss on extinguishment of debt	(3,262)		—		—		(3,262)
Income from equity affiliates	4,748		—		—		4,748
Benefit for income taxes	319		55		—		374
Net income	73,446		5,608		—		79,054
Preferred stock dividends	10,342		—		—		10,342
Net income attributable to noncontrolling interest	—		—		6,002		6,002
Net income attributable to common stockholders	$	63,104	$	5,608	$	(6,002)	$	62,710

	Nine Months Ended September 30, 2023
	Structured Business		Agency Business		Other / Eliminations (1)		Consolidated
Interest income	$	962,301	$	37,858	$	—	$	1,000,159
Interest expense	658,856		16,893		—		675,749
Net interest income	303,445		20,965		—		324,410
Other revenue:
Gain on sales, including fee-based services, net	—		55,795		—		55,795
Mortgage servicing rights	—		48,769		—		48,769
Servicing revenue	—		144,296		—		144,296
Amortization of MSRs	—		(46,920)		—		(46,920)
Property operating income	4,261		—		—		4,261
Loss on derivative instruments, net	—		(3,582)		—		(3,582)
Other income, net	3,420		1,679		—		5,099
Total other revenue	7,681		200,037		—		207,718
Other expenses:
Employee compensation and benefits	41,991		81,527		—		123,518
Selling and administrative	17,835		20,739		—		38,574
Property operating expenses	4,227		—		—		4,227
Depreciation and amortization	3,779		3,518		—		7,297
Provision for loss sharing (net of recoveries)	—		12,528		—		12,528
Provision for credit losses (net of recoveries)	52,257		2,790		—		55,047
Total other expenses	120,089		121,102		—		241,191
Income before extinguishment of debt, income from equity affiliates and income taxes	191,037		99,900		—		290,937
Loss on extinguishment of debt	(1,561)		—		—		(1,561)
Income from equity affiliates	20,694		—		—		20,694
Provision for income taxes	307		(19,743)		—		(19,436)
Net income	210,477		80,157		—		290,634
Preferred stock dividends	31,027		—		—		31,027
Net income attributable to noncontrolling interest	—		—		21,200		21,200
Net income attributable to common stockholders	$	179,450	$	80,157	$	(21,200)	$	238,407

	Nine Months Ended September 30, 2022
	Structured Business		Agency Business		Other / Eliminations (1)		Consolidated
Interest income	$	597,847	$	29,957	$	—	$	627,804
Interest expense	338,692		11,387		—		350,079
Net interest income	259,155		18,570		—		277,725
Other revenue:
Gain on sales, including fee-based services, net	—		32,526		—		32,526
Mortgage servicing rights	—		52,287		—		52,287
Servicing revenue	—		109,045		—		109,045
Amortization of MSRs	—		(44,532)		—		(44,532)
Property operating income	1,031		—		—		1,031
Gain on derivative instruments, net	—		10,083		—		10,083
Other loss, net	(4,370)		(11,691)		—		(16,061)
Total other revenue	(3,339)		147,718		—		144,379
Other expenses:
Employee compensation and benefits	42,694		77,042		—		119,736
Selling and administrative	19,799		21,161		—		40,960
Property operating expenses	1,443		—		—		1,443
Depreciation and amortization	2,574		3,518		—		6,092
Provision for loss sharing (net of recoveries)	—		(2,199)		—		(2,199)
Provision for credit losses (net of recoveries)	9,363		337		—		9,700
Total other expenses	75,873		99,859		—		175,732
Income before extinguishment of debt, income from equity affiliates and income taxes	179,943		66,429		—		246,372
Loss on extinguishment of debt	(4,612)		—		—		(4,612)
Income from equity affiliates	18,507		—		—		18,507
Provision for income taxes	(1,368)		(11,798)		—		(13,166)
Net income	192,470		54,631		—		247,101
Preferred stock dividends	30,612		—		—		30,612
Net income attributable to noncontrolling interest	—		—		19,811		19,811
Net income attributable to common stockholders	$	161,858	$	54,631	$	(19,811)	$	196,678

________________________

(1)Includes income allocated to the noncontrolling interest holders not allocated to the two reportable segments.

	September 30, 2023
	Structured Business		Agency Business		Consolidated
Assets:
Cash and cash equivalents	$	499,511	$	395,787	$	895,298
Restricted cash	410,056		9,102		419,158
Loans and investments, net	12,892,796		—		12,892,796
Loans held-for-sale, net	—		364,320		364,320
Capitalized mortgage servicing rights, net	—		392,203		392,203
Securities held-to-maturity, net	—		155,172		155,172
Investments in equity affiliates	62,795		—		62,795
Goodwill and other intangible assets	12,500		80,051		92,551
Other assets and due from related party	536,789		91,607		628,396
Total assets	$	14,414,447	$	1,488,242	$	15,902,689
Liabilities:
Debt obligations	$	11,800,537	$	354,587	$	12,155,124
Allowance for loss-sharing obligations	—		69,261		69,261
Other liabilities and due to related parties	323,061		114,742		437,803
Total liabilities	$	12,123,598	$	538,590	$	12,662,188
	December 31, 2022
Assets:
Cash and cash equivalents	$	200,514	$	333,843	$	534,357
Restricted cash	713,615		193		713,808
Loans and investments, net	14,254,674		—		14,254,674
Loans held-for-sale, net	—		354,070		354,070
Capitalized mortgage servicing rights, net	—		401,471		401,471
Securities held-to-maturity, net	—		156,547		156,547
Investments in equity affiliates	79,130		—		79,130
Goodwill and other intangible assets	12,500		83,569		96,069
Other assets and due from related party	367,837		81,022		448,859
Total assets	$	15,628,270	$	1,410,715	$	17,038,985
Liabilities:
Debt obligations	$	13,195,120	$	305,442	$	13,500,562
Allowance for loss-sharing obligations	—		57,168		57,168
Other liabilities and due to related parties	299,559		109,817		409,376
Total liabilities	$	13,494,679	$	472,427	$	13,967,106

	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Origination Data:
Structured Business
Bridge:
Multifamily	$	92,000		$	592,844		$	376,630		$	5,172,770
SFR	140,379			163,851			325,432			452,240
	232,379			756,695			702,062			5,625,010
Mezzanine / Preferred Equity	7,779			17,970			15,124			26,109
Total new loan originations	$	240,158		$	774,665		$	717,186		$	5,651,119
Number of Loans Originated	42			52			92			268
SFR Commitments	$	429,452		$	457,564		$	683,984		$	726,071
Loan runoff	$	664,792		$	911,790		$	2,536,661		$	2,700,748
Agency Business
Origination Volumes by Investor:
Fannie Mae	$	721,398		$	629,610		$	2,596,329		$	1,744,739
Freddie Mac	339,241			350,980			658,457			1,057,743
FHA	19,215			78,382			230,707			168,736
Private Label	67,965			35,671			159,328			191,913
SFR - Fixed Rate	2,030			16,678			19,328			55,883
Total	$	1,149,849		$	1,111,321		$	3,664,149		$	3,219,014
Total loan commitment volume	$	1,211,347		$	1,464,235		$	3,844,769		$	3,623,649
Agency Business Loan Sales Data:
Fannie Mae	$	837,132		$	700,690		$	2,511,978		$	1,936,282
Freddie Mac	337,507			288,029			581,306			1,009,557
FHA	24,057			35,838			201,915			182,755
Private Label	67,965			14,567			300,713			515,086
SFR - Fixed Rate	8,759			43,012			22,931			55,874
Total	$	1,275,420		$	1,082,136		$	3,618,843		$	3,699,554
Sales margin (fee-based services as a % of loan sales) (1)	1.46		%	1.33		%	1.54		%	1.34		%
MSR rate (MSR income as a % of loan commitments)	1.16		%	1.33		%	1.27		%	1.44		%

________________________

(1)The nine months ended September 30, 2022 includes $17.1 million of gains recognized on Swaps related to the Private Label loans sold, which is included in gain (loss) on derivative instruments, net in the consolidated statements of income.

	September 30, 2023
Key Servicing Metrics for Agency Business:	Servicing Portfolio UPB		Wtd. Avg. Servicing Fee Rate (basis points)	Wtd. Avg. Life of Servicing Portfolio (years)
Fannie Mae	$	20,463,620	48.3	7.7
Freddie Mac	5,184,888		24.2	8.5
Private Label	2,371,475		19.2	7.3
FHA	1,322,832		14.5	19.9
Bridge	305,950		11.2	3.6
SFR - Fixed Rate	287,942		20.1	5.8
Total	$	29,936,707	39.7	8.3
	December 31, 2022
Fannie Mae	$	19,038,124	50.2	8.0
Freddie Mac	5,153,207		25.0	9.0
Private Label	2,074,859		18.5	7.6
FHA	1,155,893		14.9	19.5
Bridge	301,182		12.5	1.7
SFR - Fixed Rate	274,764		19.8	6.0
Total	$	27,998,029	41.1	8.6

XML

Basis of Presentation and Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2023

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), for interim financial statements and the instructions to Form 10-Q. Accordingly, certain information and footnote disclosures normally included in the consolidated financial statements prepared under GAAP have been condensed or omitted. In our opinion, all adjustments considered necessary for a fair presentation of our financial position, results of operations and cash flows have been included and are of a normal and recurring nature. The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. These financial statements should be read in conjunction with our financial statements and notes thereto included in our 2022 Annual Report.

Principles of Consolidation

Principles of ConsolidationThe consolidated financial statements include our financial statements and the financial statements of our wholly owned subsidiaries, partnerships and other entities in which we own a controlling interest, including variable interest entities (“VIEs”) of which we are the primary beneficiary. Entities in which we have a significant influence are accounted for under the equity method. Our VIEs are described in Note 14. All significant intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that could materially affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The ultimate impact of inflation, increasing interest rates, bank failures, tightening of capital markets and

reduced property values, both globally and to our business, makes any estimate or assumption at September 30, 2023 inherently less certain.

Reclassification

Reclassification

Certain amounts in the prior period financial statements have been reclassified to conform to the presentation of the current period financial statements.

Recently Adopted Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Description	Adoption Date	Effect on Financial Statements
In March 2022, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2022-02, Financial Instruments—Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures. This guidance eliminates the accounting guidance on troubled debt restructurings and amends existing disclosures, including the requirement to disclose current period gross write-offs by year of origination. The guidance also updates the requirements related to accounting for credit losses and adds enhanced disclosures for creditors with respect to loan refinancings and restructurings for borrowers experiencing financial difficulty.	First quarter of 2023	The adoption of this guidance did not have a material impact on our consolidated financial statements.

Recently Issued Accounting Pronouncements

In March 2023, the FASB issued ASU 2023-01, Leases (Topic 842) – Common Control Arrangements and ASU 2023-02, Investments – Equity Method and Joint Ventures: Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method, both effective for us in the first quarter of 2024. In August 2023, the FASB issued ASU 2023-05, Business Combinations – Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement, which is effective for joint venture entities with a formation date on or after January 1, 2025. We currently do not have any transactions that fall under the scope of these ASUs; therefore, the adoptions are not expected to have an impact on our consolidated financial statements.

Significant Accounting Policies

See Item 8 – Financial Statements and Supplementary Data in our 2022 Annual Report for a description of our significant accounting policies. There have been no significant changes to our significant accounting policies since December 31, 2022.

XML

Basis of Presentation and Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2023

Accounting Policies [Abstract]

Summary of Recently Adopted Accounting Pronouncements

Description	Adoption Date	Effect on Financial Statements
In March 2022, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2022-02, Financial Instruments—Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures. This guidance eliminates the accounting guidance on troubled debt restructurings and amends existing disclosures, including the requirement to disclose current period gross write-offs by year of origination. The guidance also updates the requirements related to accounting for credit losses and adds enhanced disclosures for creditors with respect to loan refinancings and restructurings for borrowers experiencing financial difficulty.	First quarter of 2023	The adoption of this guidance did not have a material impact on our consolidated financial statements.

XML

Loans and Investments (Tables)

9 Months Ended

Sep. 30, 2023

Loans and Investments

Summary of Structured Business Loan and Investment Portfolio

Our Structured Business loan and investment portfolio consists of ($ in thousands):

	September 30, 2023		Percent of Total		Loan Count	Wtd. Avg. Pay Rate (1)		Wtd. Avg. Remaining Months to Maturity	Wtd. Avg. First Dollar LTV Ratio (2)		Wtd. Avg. Last Dollar LTV Ratio (3)
Bridge loans (4)	$	12,790,972	97	%	664	8.85	%	13.8	0	%	77	%
Mezzanine loans	233,805		2	%	47	8.35	%	54.7	45	%	79	%
Preferred equity investments	87,924		1	%	10	3.03	%	62.0	47	%	84	%
Other loans (5)	9,694		<1%		2	9.72	%	15.6	0	%	62	%
	13,122,395		100	%	723	8.80	%	14.9	1	%	77	%
Allowance for credit losses	(184,069)
Unearned revenue	(45,530)
Loans and investments, net	$	12,892,796
	December 31, 2022
Bridge loans (4)	$	14,096,054	98	%	692	8.17	%	19.8	0	%	76	%
Mezzanine loans	213,499		1	%	44	8.13	%	63.1	42	%	77	%
Preferred equity investments	110,725		1	%	8	7.63	%	39.2	46	%	79	%
Other loans (5)	35,845		<1%		3	8.76	%	32.8	0	%	58	%
	14,456,123		100	%	747	8.17	%	20.6	1	%	76	%
Allowance for credit losses	(132,559)
Unearned revenue	(68,890)
Loans and investments, net	$	14,254,674

________________________

(1)“Weighted Average Pay Rate” is a weighted average, based on the unpaid principal balance (“UPB”) of each loan in our portfolio, of the interest rate required to be paid monthly as stated in the individual loan agreements. Certain loans and investments that require an accrual rate to be paid at maturity are not included in the weighted average pay rate as shown in the table.

(2)The “First Dollar Loan-to-Value (“LTV”) Ratio” is calculated by comparing the total of our senior most dollar and all senior lien positions within the capital stack to the fair value of the underlying collateral to determine the point at which we will absorb a total loss of our position.

(3)The “Last Dollar LTV Ratio” is calculated by comparing the total of the carrying value of our loan and all senior lien positions within the capital stack to the fair value of the underlying collateral to determine the point at which we will initially absorb a loss.

(4)At September 30, 2023 and December 31, 2022, bridge loans included 311 and 241, respectively, of SFR loans with a total gross loan commitment of $2.05 billion and $1.57 billion, respectively, of which $1.16 billion and $927.4 million, respectively, was funded.

(5)Other loans represents variable rate SFR permanent loans.

Schedule of the Loan Portfolio's Internal Risk Ratings and LTV Ratios by Asset Class

A summary of the loan portfolio’s internal risk ratings and LTV ratios by asset class at September 30, 2023 is as follows ($ in thousands):

	UPB by Origination Year												Total			Wtd. Avg. First Dollar LTV Ratio		Wtd. Avg. Last Dollar LTV Ratio
Asset Class / Risk Rating	2023		2022		2021		2020		2019		Prior
Multifamily:
Pass	$	97,186	$	131,266	$	97,269	$	2,010	$	—	$	20,300	$	348,031
Pass/Watch	673,165		2,378,519		3,015,502		81,560		112,416		58,394		6,319,556
Special Mention	799		1,830,803		2,353,938		219,050		140,685		—		4,545,275
Substandard	—		290,492		153,697		24,099		—		—		468,288
Doubtful	—		—		13,930		—		9,765		—		23,695
Total Multifamily	$	771,150	$	4,631,080	$	5,634,336	$	326,719	$	262,866	$	78,694	$	11,704,845		1	%	78	%
Single-Family Rental:	Percentage of portfolio												89		%
Pass	$	22,208	$	—	$	—	$	—	$	—	$	—	$	22,208
Pass/Watch	161,976		466,391		355,176		86,347		20,965		—		1,090,855
Special Mention	—		22,924		12,852		24,503		—		—		60,279
Total Single-Family Rental	$	184,184	$	489,315	$	368,028	$	110,850	$	20,965	$	—	$	1,173,342		0	%	63	%
Land:	Percentage of portfolio												9		%
Pass/Watch	$	—	$	—	$	—	$	4,600	$	—	$	—	$	4,600
Special Mention	—		—		—		3,500		—		—		3,500
Substandard	—		—		—		—		—		127,928		127,928
Total Land	$	—	$	—	$	—	$	8,100	$	—	$	127,928	$	136,028		0	%	98	%
Office:	Percentage of portfolio												1		%
Special Mention	$	—	$	—	$	—	$	35,410	$	—	$	—	$	35,410
Substandard	—		—		—		—		—		45,025		45,025
Total Office	$	—	$	—	$	—	$	35,410	$	—	$	45,025	$	80,435		0	%	90	%
Retail:	Percentage of portfolio												1		%
Pass/Watch	$	—	$	—	$	—	$	—	$	4,000	$	—	$	4,000
Special Mention	—		—		—		—		—		3,445		3,445
Substandard	—		—		—		—		—		18,600		18,600
Total Retail	$	—	$	—	$	—	$	—	$	4,000	$	22,045	$	26,045		11	%	71	%
Other:	Percentage of portfolio												< 1%
Doubtful	$	—	$	—	$	—	$	—	$	—	$	1,700	$	1,700
Total Other	$	—	$	—	$	—	$	—	$	—	$	1,700	$	1,700		63	%	63	%
	Percentage of portfolio												< 1%
Grand Total	$	955,334	$	5,120,395	$	6,002,364	$	481,079	$	287,831	$	275,392	$	13,122,395		1	%	77	%

Schedule of the Changes in the Allowance for Credit Losses

A summary of the changes in the allowance for credit losses is as follows (in thousands):

	Three Months Ended September 30, 2023
	Multifamily		Land		Office		Retail		Commercial		Single-Family Rental		Other		Total
Allowance for credit losses:
Beginning balance	$	74,295	$	77,902	$	8,246	$	5,819	$	1,700	$	1,077	$	15	$	169,054
Provision for credit losses (net of recoveries)	14,884		60		(76)		—		—		162		(15)		15,015
Ending balance	$	89,179	$	77,962	$	8,170	$	5,819	$	1,700	$	1,239	$	—	$	184,069
	Three Months Ended September 30, 2022
Allowance for credit losses:
Beginning balance	$	27,958	$	77,918	$	7,031	$	5,819	$	1,700	$	725	$	180	$	121,331
Provision for credit losses (net of recoveries)	(675)		(8)		306		—		—		1,326		16		965
Ending balance	$	27,283	$	77,910	$	7,337	$	5,819	$	1,700	$	2,051	$	196	$	122,296
	Nine Months Ended September 30, 2023
Allowance for credit losses:
Beginning balance	$	37,961	$	78,068	$	8,162	$	5,819	$	1,700	$	781	$	68	$	132,559
Provision for credit losses (net of recoveries)	51,218		(106)		8		—		—		458		(68)		51,510
Ending balance	$	89,179	$	77,962	$	8,170	$	5,819	$	1,700	$	1,239	$	—	$	184,069
	Nine Months Ended September 30, 2022
Allowance for credit losses:
Beginning balance	$	18,707	$	77,970	$	8,073	$	5,819	$	1,700	$	320	$	652	$	113,241
Provision for credit losses (net of recoveries)	8,576		(60)		(736)		—		—		1,731		(456)		9,055
Ending balance	$	27,283	$	77,910	$	7,337	$	5,819	$	1,700	$	2,051	$	196	$	122,296

Summary of Specific Loans Considered Impaired by Asset Class

A summary of our specific loans considered impaired by asset class is as follows ($ in thousands):

	September 30, 2023
Asset Class	UPB (1)		Carrying Value		Allowance for Credit Losses		Wtd. Avg. First Dollar LTV Ratio		Wtd. Avg. Last Dollar LTV Ratio
Land	$	134,215	$	127,868	$	77,869	0	%	99	%
Multifamily	90,070		87,995		17,750		0	%	100	%
Office	45,025		45,025		7,951		0	%	99	%
Retail	22,045		17,670		5,817		13	%	78	%
Commercial	1,700		1,700		1,700		63	%	63	%
Total	$	293,055	$	280,258	$	111,087	1	%	97	%
	December 31, 2022
Land	$	134,215	$	127,868	$	77,869	0	%	99	%
Retail	22,045		17,563		5,817		14	%	79	%
Commercial	1,700		1,700		1,700		63	%	63	%
Total	$	157,960	$	147,131	$	85,386	3	%	96	%

________________________

(1)Represents the UPB of thirteen and seven impaired loans (less unearned revenue and other holdbacks and adjustments) by asset class at September 30, 2023 and December 31, 2022, respectively.

Schedule of Non-Performing Loans by Asset Class

A summary of our non-performing loans by asset class is as follows (in thousands):

	September 30, 2023						December 31, 2022
	UPB		Less Than 90 Days Past Due		Greater Than 90 Days Past Due		UPB		Less Than 90 Days Past Due		Greater Than 90 Days Past Due
Multifamily	$	152,717	$	122,847	$	29,870	$	2,605	$	—	$	2,605
Retail	3,445		—		3,445		3,445		—		3,445
Commercial	1,700		—		1,700		1,700		—		1,700
Total	$	157,862	$	122,847	$	35,015	$	7,750	$	—	$	7,750

XML

Loans Held-for-Sale, Net (Tables)

9 Months Ended

Sep. 30, 2023

Receivable, Held-for-Sale [Abstract]

Schedule of Loans Held-for-Sale, Net

Loans held-for-sale, net consists of the following (in thousands):

	September 30, 2023		December 31, 2022
Fannie Mae	$	257,371	$	173,020
Freddie Mac	86,089		8,938
Private Label	11,350		152,735
SFR - Fixed Rate	8,710		12,352
FHA	4,810		21,021
	368,330		368,066
Fair value of future MSR	4,302		5,557
Unrealized impairment loss	(2,891)		(15,703)
Unearned discount	(5,421)		(3,850)
Loans held-for-sale, net	$	364,320	$	354,070

XML

Capitalized Mortgage Servicing Rights (Tables)

9 Months Ended

Sep. 30, 2023

Transfers and Servicing [Abstract]

Summary of Capitalized MSR Activity

A summary of our capitalized MSR activity is as follows (in thousands):

	Three Months Ended September 30, 2023						Nine Months Ended September 30, 2023
	Originated		Acquired		Total		Originated		Acquired		Total
Beginning balance	$	383,267	$	11,143	$	394,410	$	386,878	$	14,593	$	401,471
Additions	16,550		—		16,550		49,416		—		49,416
Amortization	(14,988)		(912)		(15,900)		(43,866)		(3,054)		(46,920)
Write-downs and payoffs	(2,400)		(457)		(2,857)		(9,999)		(1,765)		(11,764)
Ending balance	$	382,429	$	9,774	$	392,203	$	382,429	$	9,774	$	392,203
	Three Months Ended September 30, 2022						Nine Months Ended September 30, 2022
Beginning balance	$	391,397	$	20,137	$	411,534	$	395,573	$	27,161	$	422,734
Additions	18,907		—		18,907		63,002		—		63,002
Amortization	(13,355)		(1,427)		(14,782)		(39,348)		(5,184)		(44,532)
Write-downs and payoffs	(9,957)		(1,816)		(11,773)		(32,235)		(5,083)		(37,318)
Ending balance	$	386,992	$	16,894	$	403,886	$	386,992	$	16,894	$	403,886

Summary of Expected Amortization of Capitalized MSRs

The expected amortization of capitalized MSRs recorded at September 30, 2023 is as follows (in thousands):

Year	Amortization
2023 (three months ending 12/31/2023)	$	16,169
2024	63,855
2025	60,481
2026	54,479
2027	49,654
2028	43,110
Thereafter	104,455
Total	$	392,203

XML

Mortgage Servicing (Tables)

9 Months Ended

Sep. 30, 2023

Transfers and Servicing [Abstract]

Schedule of Product and Geographic Concentration

Product and geographic concentrations that impact our servicing revenue are as follows ($ in thousands):

September 30, 2023
Product Concentrations					Geographic Concentrations
Product	UPB (1)		% of Total		State	UPB % of Total
Fannie Mae	$	20,463,620	68	%	Texas	11	%
Freddie Mac	5,184,888		17	%	New York	11	%
Private Label	2,371,475		8	%	North Carolina	8	%
FHA	1,322,832		5	%	California	8	%
Bridge (2)	305,950		1	%	Georgia	6	%
SFR - Fixed Rate	287,942		1	%	Florida	6	%
Total	$	29,936,707	100	%	New Jersey	5	%
					Illinois	4	%
					Other (3)	41	%
					Total	100	%
December 31, 2022
Fannie Mae	$	19,038,124	68	%	Texas	11	%
Freddie Mac	5,153,207		18	%	New York	11	%
Private Label	2,074,859		8	%	California	8	%
FHA	1,155,893		4	%	North Carolina	8	%
Bridge (2)	301,182		1	%	Georgia	6	%
SFR - Fixed Rate	274,764		1	%	Florida	5	%
Total	$	27,998,029	100	%	New Jersey	5	%
					Illinois	4	%
					Other (3)	42	%
					Total	100	%

________________________

(1)Excludes loans which we are not collecting a servicing fee.

(2)Represents bridge loans that were either sold by our Structured Business or refinanced by a third-party lender which we retained the right to service.

(3)No other individual state represented 4% or more of the total.

Schedule of Components of Servicing Revenue, Net

The components of servicing revenue, net are as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Servicing fees	$	32,191	$	30,631	$	92,479	$	93,702
Interest earned on escrows	20,985		7,450		57,501		10,073
Prepayment fees	1,044		11,218		6,080		42,588
Write-offs of MSRs	(2,857)		(11,773)		(11,764)		(37,318)
Amortization of MSRs	(15,900)		(14,782)		(46,920)		(44,532)
Servicing revenue, net	$	35,463	$	22,744	$	97,376	$	64,513

XML

Securities Held-To-Maturity (Tables)

9 Months Ended

Sep. 30, 2023

Debt Securities, Held-to-Maturity, Amortized Cost, after Allowance for Credit Loss, Maturity [Abstract]

Schedule of Securities Held-To-Maturity

A summary of our securities held-to-maturity is as follows (in thousands):

	Face Value		Net Carrying Value		Unrealized Gain (Loss)		Estimated Fair Value		Allowance for Credit Losses
September 30, 2023
APL certificates	$	192,791	$	127,547	$	(33,337)	$	94,210	$	2,340
B Piece bonds	38,786		27,625		4,773		32,398		3,603
Total	$	231,577	$	155,172	$	(28,564)	$	126,608	$	5,943
December 31, 2022
APL certificates	$	192,791	$	123,475	$	(13,348)	$	110,127	$	2,783
B Piece bonds	41,464		33,072		1,372		34,444		370
Total	$	234,255	$	156,547	$	(11,976)	$	144,571	$	3,153

Schedule of Changes in the Allowance for Credit Losses

A summary of the changes in the allowance for credit losses for our securities held-to-maturity is as follows (in thousands):

	Three Months Ended September 30, 2023
	APL Certificates		B Piece Bonds		Total
Beginning balance	$	3,375	$	1,159	$	4,534
Provision for credit loss expense/(reversal)	(1,035)		2,444		1,409
Ending balance	$	2,340	$	3,603	$	5,943
	Nine Months Ended September 30, 2023
Beginning balance	$	2,783	$	370	$	3,153
Provision for credit loss expense/(reversal)	(443)		3,233		2,790
Ending balance	$	2,340	$	3,603	$	5,943

XML

Investments in Equity Affiliates (Tables)

9 Months Ended

Sep. 30, 2023

Equity Method Investments and Joint Ventures [Abstract]

Summary of Equity Method Investments

We account for all investments in equity affiliates under the equity method. A summary of these investments is as follows (in thousands):

	Investments in Equity Affiliates at				UPB of Loans to Equity Affiliates at September 30, 2023
Equity Affiliates	September 30, 2023		December 31, 2022
Arbor Residential Investor LLC	$	33,447	$	46,951	$	—
Fifth Wall Ventures	13,422		13,584		—
AMAC Holdings III LLC	13,156		15,825		—
Lightstone Value Plus REIT L.P.	1,895		1,895		—
Docsumo Pte. Ltd.	450		450		—
JT Prime	425		425		—
North Vermont Avenue	—		—		—
West Shore Café	—		—		1,688
Lexford Portfolio	—		—		—
East River Portfolio	—		—		—
Total	$	62,795	$	79,130	$	1,688

XML

Debt Obligations (Tables)

9 Months Ended

Sep. 30, 2023

Debt Disclosure [Abstract]

Summary of Borrowings

Borrowings under our credit and repurchase facilities are as follows ($ in thousands):

				September 30, 2023						December 31, 2022
	Current Maturity	Extended Maturity	Note Rate Type	Debt Carrying Value (1)		Collateral Carrying Value		Wtd. Avg. Note Rate		Debt Carrying Value (1)		Collateral Carrying Value
Structured Business
$2.5B joint repurchase facility (2)	Jul. 2025	Jul. 2026	V	$	923,599	$	1,438,971	7.72	%	$	1,516,657	$	2,099,447
$1B repurchase facility (2)	Aug. 2025	Aug. 2026	V	418,206		621,759		7.58	%	498,666		703,740
$500M repurchase facility	(5)	N/A	V	374,072		505,139		8.34	%	154,653		188,563
$499M repurchase facility (2)(3)	Oct. 2023 (6)	N/A	V	343,726		491,190		7.67	%	351,056		504,506
$450M repurchase facility	Mar. 2024	Mar. 2026	V	328,650		452,318		7.50	%	344,237		450,736
$450M repurchase facility	Jan. 2024	Oct. 2024	V	93,410		120,947		7.01	%	186,639		239,678
$250M credit facility	July 2024	N/A	V	18,438		23,088		7.28	%	33,221		43,238
$225M credit facility	Jan. 2024	Jan. 2025	V	94,913		148,041		7.97	%	47,398		81,119
$200M repurchase facility	Mar. 2025	Mar. 2026	V	73,751		105,076		7.97	%	32,494		47,750
$200M repurchase facility	Jan. 2024	Jan. 2025	V	115,748		151,890		7.36	%	154,516		200,099
$174M loan specific credit facilities	Oct. 2023 (6) to Aug. 2025	Aug. 2025 to Aug. 2027	V/F	173,862		251,049		7.45	%	156,107		225,805
$50M credit facility	Apr. 2024	Apr. 2025	V	29,200		36,500		7.51	%	29,194		36,500
$40M credit facility	Apr. 2026	Apr. 2027	V	—		—		—		—		—
$35M working capital facility	Apr. 2024	N/A	V	—		—		—		—		—
$25M credit facility	Oct. 2024	N/A	V	18,248		24,625		8.02	%	18,701		24,572
Repurchase facility - securities (2)(4)	N/A	N/A	V	31,032		—		7.11	%	12,832		—
Structured Business total				$	3,036,855	$	4,370,593	7.70	%	$	3,536,371	$	4,845,753
Agency Business
$750M ASAP agreement	N/A	N/A	V	$	54,618	$	55,220	6.46	%	$	29,476	$	30,291
$500M joint repurchase facility (2)	Jul. 2025	Jul. 2026	V	7,701		11,350		7.74	%	104,629		135,641
$500M repurchase facility	Nov. 2023	N/A	V	144,818		145,618		6.69	%	66,778		66,866
$200M credit facility	Mar. 2024	N/A	V	143,654		144,168		6.71	%	31,475		33,177
$100M credit facility	July 2024	N/A	V	—		—		—		57,887		57,974
$50M credit facility	Sept. 2024	N/A	V	3,264		3,264		6.66	%	14,664		14,671
$1M repurchase facility (2)(3)	Oct. 2023 (6)	N/A	V	531		880		7.67	%	534		920
Agency Business total				$	354,586	$	360,500	6.69	%	$	305,443	$	339,540
Consolidated total				$	3,391,441	$	4,731,093	7.59	%	$	3,841,814	$	5,185,293

________________________

V = Variable Note Rate; F = Fixed Note Rate

(1)At September 30, 2023 and December 31, 2022, debt carrying value for the Structured Business was net of unamortized deferred finance costs of $6.6 million and $13.3 million, respectively, and for the Agency Business was net of unamortized deferred finance costs of $0.5 million and $0.9 million, respectively.

(2)These facilities are subject to margin call provisions associated with changes in interest spreads.

(3)A portion of this facility was used to finance a fixed-rate SFR permanent loan reported through our Agency Business.

(4)At September 30, 2023, this facility was collateralized by certificates retained by us from our Freddie Mac Q Series securitization (“Q Series securitization”) with a principal balance of $44.4 million. At December 31, 2022, this facility was collateralized by B Piece bonds with a carrying value of $33.1 million.

(5)The commitment amount under this repurchase facility expires six months after the lender provides written notice. We then have an additional six months to repurchase the underlying loans.

(6)These credit facilities, with a total committed amount of $514.5 million, mature on October 30, 2023 and we are currently in negotiations with these lenders to amend these facilities and extend the maturity.

Borrowings and the corresponding collateral under our securitized debt transactions are as follows ($ in thousands):

	Debt						Collateral (3)
							Loans				Cash
September 30, 2023	Face Value		Carrying Value (1)		Wtd. Avg. Rate (2)		UPB		Carrying Value		Restricted Cash (4)
CLO 19	$	872,812	$	867,904	7.77	%	$	1,014,554	$	1,010,753	$	4,527
CLO 18	1,652,812		1,647,326		7.22	%	1,908,793		1,903,837		20,983
CLO 17	1,714,125		1,709,255		7.10	%	1,901,897		1,896,347		149,206
CLO 16	1,237,500		1,233,286		6.73	%	1,343,886		1,340,303		91,434
CLO 15	674,412		672,897		6.78	%	770,602		768,436		19,714
CLO 14 (5)	655,475		653,876		6.74	%	756,030		754,189		13,920
Total CLOs	6,807,136		6,784,544		7.08	%	7,695,762		7,673,865		299,784
Q Series securitization	222,066		220,090		7.31	%	296,088		294,876		—
Total securitized debt	$	7,029,202	$	7,004,634	7.09	%	$	7,991,850	$	7,968,741	$	299,784
December 31, 2022
CLO 19	$	872,812	$	866,605	6.75	%	$	952,268	$	947,336	$	64,300
CLO 18	1,652,812		1,645,711		6.19	%	1,899,174		1,891,215		85,970
CLO 17	1,714,125		1,707,676		6.16	%	1,911,866		1,904,732		145,726
CLO 16	1,237,500		1,231,887		5.79	%	1,307,244		1,301,794		106,495
CLO 15	674,412		671,532		5.84	%	797,755		795,078		2,861
CLO 14	655,475		652,617		5.80	%	732,247		730,057		37,090
CLO 13	462,769		461,005		6.03	%	552,182		550,924		37,875
CLO 12	379,283		378,331		6.09	%	466,474		465,003		500
Total CLOs	7,649,188		7,615,364		6.10	%	8,619,210		8,586,139		480,817
Q Series securitization	236,878		233,906		6.30	%	315,837		313,965		—
Total securitized debt	$	7,886,066	$	7,849,270	6.11	%	$	8,935,047	$	8,900,104	$	480,817

________________________

(1)Debt carrying value is net of $24.6 million and $36.8 million of deferred financing fees at September 30, 2023 and December 31, 2022, respectively.

(2)At September 30, 2023 and December 31, 2022, the aggregate weighted average note rate for our securitized debt, including certain fees and costs, was 7.34% and 6.32%, respectively.

(3)At September 30, 2023, four loans with an aggregate UPB of $89.8 million were deemed a "credit risk" as defined by the collateralized loan obligations ("CLO") indentures. At December 31, 2022, there was no collateral deemed a “credit risk” as defined by the CLO indentures. A credit risk asset is generally defined as one that, in the CLO collateral manager's reasonable business judgment, has a significant risk of becoming a defaulted asset.

(4)Represents restricted cash held for principal repayments as well as for reinvestment in the CLOs. Excludes restricted cash related to interest payments, delayed fundings and expenses totaling $108.5 million and $230.0 million at September 30, 2023 and December 31, 2022, respectively.

(5)The replenishment period of CLO 14 ended in September 2023.

Summary of Senior Unsecured Notes

A summary of our senior unsecured notes is as follows ($ in thousands):

Senior Unsecured Notes	Issuance Date		September 30, 2023						December 31, 2022
		Maturity	UPB		Carrying Value (1)		Wtd. Avg. Rate (2)		UPB		Carrying Value (1)		Wtd. Avg. Rate (2)
7.75% Notes (3)	Mar. 2023	Mar. 2026	$	95,000	$	93,552	7.75	%	$	—	$	—	—
8.50% Notes (3)	Oct. 2022	Oct. 2027	150,000		147,904		8.50	%	150,000		147,519		8.50	%
5.00% Notes (3)	Dec. 2021	Dec. 2028	180,000		177,769		5.00	%	180,000		177,450		5.00	%
4.50% Notes (3)	Aug. 2021	Sept. 2026	270,000		267,555		4.50	%	270,000		266,926		4.50	%
5.00% Notes (3)	Apr. 2021	Apr. 2026	175,000		173,386		5.00	%	175,000		172,917		5.00	%
4.50% Notes (3)	Mar. 2020	Mar. 2027	275,000		273,322		4.50	%	275,000		272,960		4.50	%
4.75% Notes (4)	Oct. 2019	Oct. 2024	110,000		109,633		4.75	%	110,000		109,369		4.75	%
5.75% Notes (4)	Mar. 2019	Apr. 2024	90,000		89,805		5.75	%	90,000		89,514		5.75	%
8.00% Notes (3)	Apr. 2020	Apr. 2023	—		—		—		70,750		70,613		8.00	%
5.625% Notes (4)	Mar. 2018	May 2023	—		—		—		78,850		78,726		5.63	%
			$	1,345,000	$	1,332,926	5.41	%	$	1,399,600	$	1,385,994	5.40	%

________________________

(1)At September 30, 2023 and December 31, 2022, the carrying value is net of deferred financing fees of $12.1 million and $13.6 million, respectively.

(2)At September 30, 2023 and December 31, 2022, the aggregate weighted average note rate, including certain fees and costs, was 5.70% and 5.69%, respectively.

(3)These notes can be redeemed by us prior to three months before the maturity date, at a redemption price equal to 100% of the aggregate principal amount, plus a “make-whole” premium and accrued and unpaid interest. We have the right to redeem the notes within three months prior to the maturity date at a redemption price equal to 100% of the aggregate principal amount, plus accrued and unpaid interest.

(4)These notes can be redeemed by us at any time prior to the maturity date, at a redemption price equal to 100% of the aggregate principal amount, plus a “make-whole” premium and accrued and unpaid interest. We have the right to redeem the notes on the maturity date at a redemption price equal to 100% of the aggregate principal amount, plus accrued and unpaid interest.

Summary of UPB and Net Carrying Value of Convertible Notes

The UPB and net carrying value of our convertible notes are as follows (in thousands):

Period	UPB		Unamortized Deferred Financing Fees		Net Carrying Value
September 30, 2023	$	287,500	$	5,072	$	282,428
December 31, 2022	$	287,500	$	7,144	$	280,356

Summary of CLO Compliance Tests

Our CLO compliance tests as of the most recent determination dates in October 2023 are as follows:

Cash Flow Triggers	CLO 14		CLO 15		CLO 16		CLO 17		CLO 18		CLO 19
Overcollateralization (1)
Current	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%
Limit	118.76	%	119.85	%	120.21	%	121.51	%	123.03	%	119.30	%
Pass / Fail	Pass		Pass		Pass		Pass		Pass		Pass
Interest Coverage (2)
Current	153.74	%	151.78	%	148.88	%	143.35	%	148.56	%	132.54	%
Limit	120.00	%	120.00	%	120.00	%	120.00	%	120.00	%	120.00	%
Pass / Fail	Pass		Pass		Pass		Pass		Pass		Pass

________________________

(1)The overcollateralization ratio divides the total principal balance of all collateral in the CLO by the total principal balance of the bonds associated with the applicable ratio. To the extent an asset is considered a defaulted security, the asset’s principal balance for purposes of the overcollateralization test is the lesser of the asset’s market value or the principal balance of the defaulted asset multiplied by the asset’s recovery rate which is determined by the rating agencies. Rating downgrades of CLO collateral will generally not have a direct impact on the principal balance of a CLO asset for purposes of calculating the CLO overcollateralization test unless the rating downgrade is below a significantly low threshold (e.g. CCC-) as defined in each CLO vehicle.

(2)The interest coverage ratio divides interest income by interest expense for the classes senior to those retained by us.

Summary of CLO Overcollateralization Ratios

Our CLO overcollateralization ratios as of the determination dates subsequent to each quarter are as follows:

Determination (1)	CLO 14		CLO 15		CLO 16		CLO 17		CLO 18		CLO 19
October 2023	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%
July 2023	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%
April 2023	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%
January 2023	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%
October 2022	119.76	%	120.85	%	121.21	%	122.51	%	124.03	%	120.30	%

________________________

(1)This table represents the quarterly trend of our overcollateralization ratio, however, the CLO determination dates are monthly and we were in compliance with this test for all periods presented.

XML

Allowance for Loss-Sharing Obligations (Tables)

9 Months Ended

Sep. 30, 2023

Loss Contingency Accrual, Disclosures [Abstract]

Schedule of Allowance for Loss-Sharing

Our allowance for loss-sharing obligations related to the Fannie Mae DUS program is as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Beginning balance	$	66,681	$	53,053	$	57,168	$	56,064
Provisions for loss sharing	1,703		2,346		13,992		2,593
Provisions reversal for loan repayments	(24)		(1,934)		(1,464)		(4,792)
Recoveries (charge-offs), net	901		46		(435)		(354)
Ending balance	$	69,261	$	53,511	$	69,261	$	53,511

XML

Derivative Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Non-Qualifying Derivative Financial Instruments

A summary of our non-qualifying derivative financial instruments in our Agency Business is as follows ($ in thousands):

	September 30, 2023
					Fair Value
Derivative	Count	Notional Value		Balance Sheet Location	Derivative Assets		Derivative Liabilities
Rate lock commitments	4	$	107,093	Other assets/other liabilities	$	962	$	(2,339)
Forward sale commitments	36	455,363		Other assets/other liabilities	2,379		(5,822)
Swaps	82	8,200			—		—
		$	570,656		$	3,341	$	(8,161)
	December 31, 2022
Rate lock commitments	6	$	91,472	Other assets/other liabilities	$	354	$	(1,070)
Forward sale commitments	27	294,451		Other assets/other liabilities	1,151		(3,827)
Swaps	1,298	129,800			—		—
		$	515,723		$	1,505	$	(4,897)

XML

Fair Value (Tables)

9 Months Ended

Sep. 30, 2023

Fair Value Disclosures [Abstract]

Schedule of Principal Amounts, Carrying Values, and Estimated Fair Values of Financial Instruments

The following table summarizes the principal amounts, carrying values and the estimated fair values of our financial instruments (in thousands):

	September 30, 2023						December 31, 2022
	Principal / Notional Amount		Carrying Value		Estimated Fair Value		Principal / Notional Amount		Carrying Value		Estimated Fair Value
Financial assets:
Loans and investments, net	$	13,122,395	$	12,892,796	$	12,911,172	$	14,456,123	$	14,254,674	$	14,468,418
Loans held-for-sale, net	368,330		364,320		374,534		368,066		354,070		362,054
Capitalized mortgage servicing rights, net	n/a		392,203		538,078		n/a		401,471		530,913
Securities held-to-maturity, net	231,577		155,172		126,608		234,255		156,547		144,571
Derivative financial instruments	130,778		3,341		3,341		111,950		1,505		1,505
Financial liabilities:
Credit and repurchase facilities	$	3,398,451	$	3,391,441	$	3,382,933	$	3,856,009	$	3,841,814	$	3,828,192
Securitized debt	7,029,202		7,004,634		6,899,147		7,886,066		7,849,270		7,560,541
Senior unsecured notes	1,345,000		1,332,926		1,211,633		1,399,600		1,385,994		1,262,560
Convertible senior unsecured notes	287,500		282,428		290,019		287,500		280,356		287,834
Junior subordinated notes	154,336		143,695		105,821		154,336		143,128		103,977
Derivative financial instruments	431,678		8,161		8,161		273,973		4,897		4,897

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The fair values of these financial assets and liabilities are determined using the following input levels at September 30, 2023 (in thousands):

	Carrying Value		Fair Value		Fair Value Measurements Using Fair Value Hierarchy
					Level 1		Level 2		Level 3
Financial assets:
Derivative financial instruments	$	3,341	$	3,341	$	—	$	2,379	$	962
Financial liabilities:
Derivative financial instruments	$	8,161	$	8,161	$	—	$	8,161	$	—

Fair Value Measurements, Nonrecurring

The fair values of these financial and non-financial assets, if applicable, are determined using the following input levels at September 30, 2023 (in thousands):

	Net Carrying Value		Fair Value		Fair Value Measurements Using Fair Value Hierarchy
					Level 1		Level 2		Level 3
Financial assets:
Impaired loans, net
Loans held-for-investment (1)	$	169,171	$	169,171	$	—	$	—	$	169,171
Loans held-for-sale (2)	17,169		17,169		—		17,169		—
	$	186,340	$	186,340	$	—	$	17,169	$	169,171

________________________

(1)We had an allowance for credit losses of $111.1 million relating to thirteen impaired loans with an aggregate carrying value, before loan loss reserves, of $280.3 million at September 30, 2023.

(2)We had unrealized impairment losses of $2.9 million related to six held-for-sale loans with an aggregate carrying value, before unrealized impairment losses, of $20.1 million.

Fair Value Measurement Inputs and Valuation Techniques

Quantitative information about Level 3 fair value measurements at September 30, 2023 is as follows ($ in thousands):

	Fair Value		Valuation Techniques	Significant Unobservable Inputs
Financial assets:
Impaired loans:
Multifamily	$	70,246	Discounted cash flows	Capitalization rate	6.53	%
Land	50,000		Discounted cash flows	Discount rate	21.50	%
				Revenue growth rate	3.00	%
				Discount rate	7.50	%
Office	37,074		Discounted cash flows	Capitalization rate	5.25	%
				Revenue growth rate	3.00	%
				Discount rate	11.25	%
Retail	11,851		Discounted cash flows	Capitalization rate	9.25	%
				Revenue growth rate	3.00	%
Derivative financial instruments:
Rate lock commitments	962		Discounted cash flows	W/A discount rate	12.27	%

Schedule of Roll Forward of Level 3 Derivative Instruments

A roll-forward of Level 3 derivative instruments is as follows (in thousands):

	Fair Value Measurements Using Significant Unobservable Inputs
	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Derivative assets and liabilities, net
Beginning balance	$	757	$	1,035	$	354	$	295
Settlements	(13,369)		(16,554)		(46,123)		(47,491)
Realized gains recorded in earnings	12,612		15,519		45,769		47,196
Unrealized gains recorded in earnings	962		1,554		962		1,554
Ending balance	$	962	$	1,554	$	962	$	1,554

Schedule of Components of Fair and Other Relevant Information

The components of fair value and other relevant information associated with our rate lock commitments, forward sales commitments and the estimated fair value of cash flows from servicing on loans held-for-sale are as follows (in thousands):

September 30, 2023	Notional/ Principal Amount		Fair Value of Servicing Rights		Interest Rate Movement Effect		Unrealized Impairment Loss		Total Fair Value Adjustment
Rate lock commitments	$	107,093	$	962	$	(2,339)	$	—	$	(1,377)
Forward sale commitments	455,363		—		2,339		—		2,339
Loans held-for-sale, net (1)	368,330		4,302		—		(2,891)		1,411
Total			$	5,264	$	—	$	(2,891)	$	2,373

________________________

(1)Loans held-for-sale, net are recorded at the lower of cost or market on an aggregate basis and includes fair value adjustments related to estimated cash flows from MSRs.

Fair Value Measurements, Recurring and Nonrecurring

The fair value of these assets and liabilities are determined using the following input levels at September 30, 2023 (in thousands):

					Fair Value Measurements Using Fair Value Hierarchy
	Carrying Value		Fair Value		Level 1		Level 2		Level 3
Financial assets:
Loans and investments, net	$	12,892,796	$	12,911,172	$	—	$	—	$	12,911,172
Loans held-for-sale, net	364,320		374,534		—		370,232		4,302
Capitalized mortgage servicing rights, net	392,203		538,078		—		—		538,078
Securities held-to-maturity, net	155,172		126,608		—		—		126,608
Financial liabilities:
Credit and repurchase facilities	$	3,391,441	$	3,382,933	$	—	$	354,586	$	3,028,347
Securitized debt	7,004,634		6,899,147		—		—		6,899,147
Senior unsecured notes	1,332,926		1,211,633		1,211,633		—		—
Convertible senior unsecured notes	282,428		290,019		—		290,019		—
Junior subordinated notes	143,695		105,821		—		—		105,821

XML

Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2023

Commitments and Contingencies Disclosure [Abstract]

Schedule of Maturities of Operating Lease Liabilities

Debt Obligations and Operating Leases. At September 30, 2023, the maturities of our debt obligations and the minimum annual operating lease payments under leases with a term in excess of one year are as follows (in thousands):

Year	Debt Obligations		Minimum Annual Operating Lease Payments		Total
2023 (three months ending December 31, 2023)	$	858,768	$	2,300	$	861,068
2024	2,004,350		10,188		2,014,538
2025	3,378,563		10,555		3,389,118
2026	4,523,241		10,627		4,533,868
2027	1,115,231		9,225		1,124,456
2028	180,000		8,624		188,624
Thereafter	154,336		27,755		182,091
Total	$	12,214,489	$	79,274	$	12,293,763

XML

Variable Interest Entities (Tables)

9 Months Ended

Sep. 30, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Variable Interest Entities

The assets and liabilities related to these consolidated Securitization Entities are as follows (in thousands):

	September 30, 2023		December 31, 2022
Assets:
Restricted cash	$	408,569	$	710,775
Loans and investments, net	7,968,741		8,900,104
Other assets	311,988		174,382
Total assets	$	8,689,298	$	9,785,261
Liabilities:
Securitized debt	$	7,004,634	$	7,849,270
Other liabilities	23,259		26,754
Total liabilities	$	7,027,893	$	7,876,024

Schedule of Unconsolidated Variable Interest Entities

A summary of our variable interests in identified VIEs, of which we are not the primary beneficiary, at September 30, 2023 is as follows (in thousands):

Type	Carrying Amount (1)
Loans	$	433,532
APL certificates	129,887
B Piece bonds	31,228
Equity investments	17,771
Agency interest only strips	177
Total	$	612,595

________________________

(1)Represents the carrying amount of loans and investments before reserves. At September 30, 2023, $172.9 million of loans to VIEs had corresponding specific loan loss reserves of $85.8 million. The maximum loss exposure at September 30, 2023 would not exceed the carrying amount of our investment.

XML

Equity (Tables)

9 Months Ended

Sep. 30, 2023

Stockholders' Equity Note [Abstract]

Schedule of Dividends Payable

Dividends declared (on a per share basis) during the nine months ended September 30, 2023 are as follows:

Common Stock			Preferred Stock
				Dividend
Declaration Date	Dividend		Declaration Date	Series D		Series E		Series F
February 15, 2023	$	0.40	January 3, 2023	$	0.3984375	$	0.390625	$	0.390625
May 3, 2023	$	0.42	March 31, 2023	$	0.3984375	$	0.390625	$	0.390625
July 26, 2023	$	0.43	June 30, 2023	$	0.3984375	$	0.390625	$	0.390625
			September 29, 2023	$	0.3984375	$	0.390625	$	0.390625

Schedule of Earnings Per Share, Basic and Diluted

A reconciliation of the numerator and denominator of our basic and diluted EPS computations is as follows ($ in thousands, except share and per share data):

	Three Months Ended September 30,
	2023				2022
	Basic		Diluted		Basic		Diluted
Net income attributable to common stockholders (1)	$	77,924	$	77,924	$	62,710	$	62,710
Net income attributable to noncontrolling interest (2)	—		6,789		—		6,002
Interest expense on convertible notes	—		6,081		—		5,797
Net income attributable to common stockholders and noncontrolling interest	$	77,924	$	90,794	$	62,710	$	74,509
Weighted average shares outstanding	187,023,395		187,023,395		170,227,553		170,227,553
Dilutive effect of OP Units (2)	—		16,293,589		—		16,293,589
Dilutive effect of convertible notes	—		17,312,382		—		18,815,399
Dilutive effect of restricted stock units (3)	—		699,452		—		528,475
Weighted average shares outstanding	187,023,395		221,328,818		170,227,553		205,865,016
Net income per common share (1)	$	0.42	$	0.41	$	0.37	$	0.36
	Nine Months Ended September 30,
	2023				2022
Net income attributable to common stockholders (1)	$	238,407	$	238,407	$	196,678	$	196,678
Net income attributable to noncontrolling interest (2)	—		21,200		—		19,811
Interest expense on convertible notes	—		18,244		—		13,786
Net income attributable to common stockholders and noncontrolling interest	$	238,407	$	277,851	$	196,678	$	230,275
Weighted average shares outstanding	183,340,149		183,340,149		162,292,235		162,292,235
Dilutive effect of OP Units (2)	—		16,293,589		—		16,308,361
Dilutive effect of convertible notes	—		17,271,419		—		16,370,528
Dilutive effect of restricted stock units (3)	—		552,242		—		558,216
Weighted average shares outstanding	183,340,149		217,457,399		162,292,235		195,529,340
Net income per common share (1)	$	1.30	$	1.28	$	1.21	$	1.18

________________________

(1)Net of preferred stock dividends.

(2)We consider OP Units to be common stock equivalents as the holders have voting rights, the right to distributions and the right to redeem the OP Units for the cash value of a corresponding number of shares of common stock or a corresponding number of shares of common stock, at our election.

(3)Our chief executive officer was granted restricted stock units, which vest at the end of a four-year performance period based upon our achievement of total stockholder return objectives.

XML

Segment Information (Tables)

9 Months Ended

Sep. 30, 2023

Segment Reporting [Abstract]

Schedule of Statement of Income and Balance Sheet by Segment

	Three Months Ended September 30, 2023
	Structured Business		Agency Business		Other / Eliminations (1)		Consolidated
Interest income	$	322,819	$	13,655	$	—	$	336,474
Interest expense	222,996		6,184		—		229,180
Net interest income	99,823		7,471		—		107,294
Other revenue:
Gain on sales, including fee-based services, net	—		18,619		—		18,619
Mortgage servicing rights	—		14,109		—		14,109
Servicing revenue	—		51,363		—		51,363
Amortization of MSRs	—		(15,900)		—		(15,900)
Property operating income	1,450		—		—		1,450
Loss on derivative instruments, net	—		(421)		—		(421)
Other income (loss), net	751		(578)		—		173
Total other revenue	2,201		67,192		—		69,393
Other expenses:
Employee compensation and benefits	12,912		26,898		—		39,810
Selling and administrative	5,291		7,076		—		12,367
Property operating expenses	1,479		—		—		1,479
Depreciation and amortization	1,114		1,172		—		2,286
Provision for loss sharing (net of recoveries)	—		1,679		—		1,679
Provision for credit losses (net of recoveries)	17,243		1,409		—		18,652
Total other expenses	38,039		38,234		—		76,273
Income before extinguishment of debt, income from equity affiliates and income taxes	63,985		36,429		—		100,414
Loss on extinguishment of debt	(314)		—		—		(314)
Income from equity affiliates	809		—		—		809
Provision for income taxes	1,078		(6,932)		—		(5,854)
Net income	65,558		29,497		—		95,055
Preferred stock dividends	10,342		—		—		10,342
Net income attributable to noncontrolling interest	—		—		6,789		6,789
Net income attributable to common stockholders	$	55,216	$	29,497	$	(6,789)	$	77,924

	Three Months Ended September 30, 2022
	Structured Business		Agency Business		Other / Eliminations (1)		Consolidated
Interest income	$	249,539	$	10,239	$	—	$	259,778
Interest expense	157,325		3,127		—		160,452
Net interest income	92,214		7,112		—		99,326
Other revenue:
Gain on sales, including fee-based services, net	—		14,360		—		14,360
Mortgage servicing rights	—		19,408		—		19,408
Servicing revenue	—		37,526		—		37,526
Amortization of MSRs	—		(14,782)		—		(14,782)
Property operating income	445		—		—		445
Loss on derivative instruments, net	—		(15,909)		—		(15,909)
Other income (loss), net	1,763		(7,777)		—		(6,014)
Total other revenue	2,208		32,826		—		35,034
Other expenses:
Employee compensation and benefits	13,342		25,469		—		38,811
Selling and administrative	5,961		7,264		—		13,225
Property operating expenses	366		—		—		366
Depreciation and amortization	906		1,172		—		2,078
Provision for loss sharing (net of recoveries)	—		412		—		412
Provision for credit losses (net of recoveries)	2,206		68		—		2,274
Total other expenses	22,781		34,385		—		57,166
Income before extinguishment of debt, income from equity affiliates and income taxes	71,641		5,553		—		77,194
Loss on extinguishment of debt	(3,262)		—		—		(3,262)
Income from equity affiliates	4,748		—		—		4,748
Benefit for income taxes	319		55		—		374
Net income	73,446		5,608		—		79,054
Preferred stock dividends	10,342		—		—		10,342
Net income attributable to noncontrolling interest	—		—		6,002		6,002
Net income attributable to common stockholders	$	63,104	$	5,608	$	(6,002)	$	62,710

	Nine Months Ended September 30, 2023
	Structured Business		Agency Business		Other / Eliminations (1)		Consolidated
Interest income	$	962,301	$	37,858	$	—	$	1,000,159
Interest expense	658,856		16,893		—		675,749
Net interest income	303,445		20,965		—		324,410
Other revenue:
Gain on sales, including fee-based services, net	—		55,795		—		55,795
Mortgage servicing rights	—		48,769		—		48,769
Servicing revenue	—		144,296		—		144,296
Amortization of MSRs	—		(46,920)		—		(46,920)
Property operating income	4,261		—		—		4,261
Loss on derivative instruments, net	—		(3,582)		—		(3,582)
Other income, net	3,420		1,679		—		5,099
Total other revenue	7,681		200,037		—		207,718
Other expenses:
Employee compensation and benefits	41,991		81,527		—		123,518
Selling and administrative	17,835		20,739		—		38,574
Property operating expenses	4,227		—		—		4,227
Depreciation and amortization	3,779		3,518		—		7,297
Provision for loss sharing (net of recoveries)	—		12,528		—		12,528
Provision for credit losses (net of recoveries)	52,257		2,790		—		55,047
Total other expenses	120,089		121,102		—		241,191
Income before extinguishment of debt, income from equity affiliates and income taxes	191,037		99,900		—		290,937
Loss on extinguishment of debt	(1,561)		—		—		(1,561)
Income from equity affiliates	20,694		—		—		20,694
Provision for income taxes	307		(19,743)		—		(19,436)
Net income	210,477		80,157		—		290,634
Preferred stock dividends	31,027		—		—		31,027
Net income attributable to noncontrolling interest	—		—		21,200		21,200
Net income attributable to common stockholders	$	179,450	$	80,157	$	(21,200)	$	238,407

	Nine Months Ended September 30, 2022
	Structured Business		Agency Business		Other / Eliminations (1)		Consolidated
Interest income	$	597,847	$	29,957	$	—	$	627,804
Interest expense	338,692		11,387		—		350,079
Net interest income	259,155		18,570		—		277,725
Other revenue:
Gain on sales, including fee-based services, net	—		32,526		—		32,526
Mortgage servicing rights	—		52,287		—		52,287
Servicing revenue	—		109,045		—		109,045
Amortization of MSRs	—		(44,532)		—		(44,532)
Property operating income	1,031		—		—		1,031
Gain on derivative instruments, net	—		10,083		—		10,083
Other loss, net	(4,370)		(11,691)		—		(16,061)
Total other revenue	(3,339)		147,718		—		144,379
Other expenses:
Employee compensation and benefits	42,694		77,042		—		119,736
Selling and administrative	19,799		21,161		—		40,960
Property operating expenses	1,443		—		—		1,443
Depreciation and amortization	2,574		3,518		—		6,092
Provision for loss sharing (net of recoveries)	—		(2,199)		—		(2,199)
Provision for credit losses (net of recoveries)	9,363		337		—		9,700
Total other expenses	75,873		99,859		—		175,732
Income before extinguishment of debt, income from equity affiliates and income taxes	179,943		66,429		—		246,372
Loss on extinguishment of debt	(4,612)		—		—		(4,612)
Income from equity affiliates	18,507		—		—		18,507
Provision for income taxes	(1,368)		(11,798)		—		(13,166)
Net income	192,470		54,631		—		247,101
Preferred stock dividends	30,612		—		—		30,612
Net income attributable to noncontrolling interest	—		—		19,811		19,811
Net income attributable to common stockholders	$	161,858	$	54,631	$	(19,811)	$	196,678

________________________

(1)Includes income allocated to the noncontrolling interest holders not allocated to the two reportable segments.

	September 30, 2023
	Structured Business		Agency Business		Consolidated
Assets:
Cash and cash equivalents	$	499,511	$	395,787	$	895,298
Restricted cash	410,056		9,102		419,158
Loans and investments, net	12,892,796		—		12,892,796
Loans held-for-sale, net	—		364,320		364,320
Capitalized mortgage servicing rights, net	—		392,203		392,203
Securities held-to-maturity, net	—		155,172		155,172
Investments in equity affiliates	62,795		—		62,795
Goodwill and other intangible assets	12,500		80,051		92,551
Other assets and due from related party	536,789		91,607		628,396
Total assets	$	14,414,447	$	1,488,242	$	15,902,689
Liabilities:
Debt obligations	$	11,800,537	$	354,587	$	12,155,124
Allowance for loss-sharing obligations	—		69,261		69,261
Other liabilities and due to related parties	323,061		114,742		437,803
Total liabilities	$	12,123,598	$	538,590	$	12,662,188
	December 31, 2022
Assets:
Cash and cash equivalents	$	200,514	$	333,843	$	534,357
Restricted cash	713,615		193		713,808
Loans and investments, net	14,254,674		—		14,254,674
Loans held-for-sale, net	—		354,070		354,070
Capitalized mortgage servicing rights, net	—		401,471		401,471
Securities held-to-maturity, net	—		156,547		156,547
Investments in equity affiliates	79,130		—		79,130
Goodwill and other intangible assets	12,500		83,569		96,069
Other assets and due from related party	367,837		81,022		448,859
Total assets	$	15,628,270	$	1,410,715	$	17,038,985
Liabilities:
Debt obligations	$	13,195,120	$	305,442	$	13,500,562
Allowance for loss-sharing obligations	—		57,168		57,168
Other liabilities and due to related parties	299,559		109,817		409,376
Total liabilities	$	13,494,679	$	472,427	$	13,967,106

Schedule of Origination Data and Loans Sales Data By Segment

	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Origination Data:
Structured Business
Bridge:
Multifamily	$	92,000		$	592,844		$	376,630		$	5,172,770
SFR	140,379			163,851			325,432			452,240
	232,379			756,695			702,062			5,625,010
Mezzanine / Preferred Equity	7,779			17,970			15,124			26,109
Total new loan originations	$	240,158		$	774,665		$	717,186		$	5,651,119
Number of Loans Originated	42			52			92			268
SFR Commitments	$	429,452		$	457,564		$	683,984		$	726,071
Loan runoff	$	664,792		$	911,790		$	2,536,661		$	2,700,748
Agency Business
Origination Volumes by Investor:
Fannie Mae	$	721,398		$	629,610		$	2,596,329		$	1,744,739
Freddie Mac	339,241			350,980			658,457			1,057,743
FHA	19,215			78,382			230,707			168,736
Private Label	67,965			35,671			159,328			191,913
SFR - Fixed Rate	2,030			16,678			19,328			55,883
Total	$	1,149,849		$	1,111,321		$	3,664,149		$	3,219,014
Total loan commitment volume	$	1,211,347		$	1,464,235		$	3,844,769		$	3,623,649
Agency Business Loan Sales Data:
Fannie Mae	$	837,132		$	700,690		$	2,511,978		$	1,936,282
Freddie Mac	337,507			288,029			581,306			1,009,557
FHA	24,057			35,838			201,915			182,755
Private Label	67,965			14,567			300,713			515,086
SFR - Fixed Rate	8,759			43,012			22,931			55,874
Total	$	1,275,420		$	1,082,136		$	3,618,843		$	3,699,554
Sales margin (fee-based services as a % of loan sales) (1)	1.46		%	1.33		%	1.54		%	1.34		%
MSR rate (MSR income as a % of loan commitments)	1.16		%	1.33		%	1.27		%	1.44		%

________________________

(1)The nine months ended September 30, 2022 includes $17.1 million of gains recognized on Swaps related to the Private Label loans sold, which is included in gain (loss) on derivative instruments, net in the consolidated statements of income.

Schedule of Key Servicing Metrics for Agency Business

	September 30, 2023
Key Servicing Metrics for Agency Business:	Servicing Portfolio UPB		Wtd. Avg. Servicing Fee Rate (basis points)	Wtd. Avg. Life of Servicing Portfolio (years)
Fannie Mae	$	20,463,620	48.3	7.7
Freddie Mac	5,184,888		24.2	8.5
Private Label	2,371,475		19.2	7.3
FHA	1,322,832		14.5	19.9
Bridge	305,950		11.2	3.6
SFR - Fixed Rate	287,942		20.1	5.8
Total	$	29,936,707	39.7	8.3
	December 31, 2022
Fannie Mae	$	19,038,124	50.2	8.0
Freddie Mac	5,153,207		25.0	9.0
Private Label	2,074,859		18.5	7.6
FHA	1,155,893		14.9	19.5
Bridge	301,182		12.5	1.7
SFR - Fixed Rate	274,764		19.8	6.0
Total	$	27,998,029	41.1	8.6

XML

Description of Business (Details)	9 Months Ended
	Sep. 30, 2023 segment
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of business segments	2

XML

Loans and Investments - Investment Portfolio and Concentration of Credit Risk (Details) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2023 USD ($) loan	Dec. 31, 2022 USD ($) loan	Jun. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Jun. 30, 2022 USD ($)	Dec. 31, 2021 USD ($)
Loans and Investments
Loans and investments, gross	$ 13,122,395	$ 14,456,123
Allowance for credit losses	(184,069)	(132,559)	$ (169,054)	$ (122,296)	$ (121,331)	$ (113,241)
Unearned revenue	(45,530)	(68,890)
Loans and investments, net	$ 12,892,796	$ 14,254,674
Percent of Total	100.00%	100.00%
Loan Count | loan	723	747
Wtd. Avg. Pay Rate (as a percent)	8.80%	8.17%
Wtd. Avg. Remaining Months to Maturity	14 months 27 days	20 months 18 days
Wtd. Avg. First Dollar LTV Ratio (as percent)	1.00%	1.00%
Wtd. Avg. Last Dollar LTV Ratio (as percent)	77.00%	76.00%
Single-Family Rental
Loans and Investments
Allowance for credit losses	$ (1,239)	$ (781)	(1,077)	$ (2,051)	$ (725)	$ (320)
Bridge loans
Loans and Investments
Loans and investments, gross	$ 12,790,972	$ 14,096,054	$ 70,500
Percent of Total	97.00%	98.00%
Loan Count | loan	664	692
Wtd. Avg. Pay Rate (as a percent)	8.85%	8.17%
Wtd. Avg. Remaining Months to Maturity	13 months 24 days	19 months 24 days
Wtd. Avg. First Dollar LTV Ratio (as percent)	0.00%	0.00%
Wtd. Avg. Last Dollar LTV Ratio (as percent)	77.00%	76.00%
Bridge loans | Single-Family Rental
Loans and Investments
Number of loans under the loan portfolio | loan	311	241
Total loan commitment	$ 2,050,000	$ 1,570,000
Mezzanine loans
Loans and Investments
Loans and investments, gross	$ 233,805	$ 213,499
Percent of Total	2.00%	1.00%
Loan Count | loan	47	44
Wtd. Avg. Pay Rate (as a percent)	8.35%	8.13%
Wtd. Avg. Remaining Months to Maturity	54 months 21 days	63 months 3 days
Wtd. Avg. First Dollar LTV Ratio (as percent)	45.00%	42.00%
Wtd. Avg. Last Dollar LTV Ratio (as percent)	79.00%	77.00%
Preferred equity investments
Loans and Investments
Loans and investments, gross	$ 87,924	$ 110,725
Percent of Total	1.00%	1.00%
Loan Count | loan	10	8
Wtd. Avg. Pay Rate (as a percent)	3.03%	7.63%
Wtd. Avg. Remaining Months to Maturity	62 months	39 months 6 days
Wtd. Avg. First Dollar LTV Ratio (as percent)	47.00%	46.00%
Wtd. Avg. Last Dollar LTV Ratio (as percent)	84.00%	79.00%
Other loans
Loans and Investments
Loans and investments, gross	$ 9,694	$ 35,845
Percent of Total	1.00%	1.00%
Loan Count | loan	2	3
Wtd. Avg. Pay Rate (as a percent)	9.72%	8.76%
Wtd. Avg. Remaining Months to Maturity	15 months 18 days	32 months 24 days
Wtd. Avg. First Dollar LTV Ratio (as percent)	0.00%	0.00%
Wtd. Avg. Last Dollar LTV Ratio (as percent)	62.00%	58.00%
Other loans | Single-Family Rental
Loans and Investments
Unpaid principal balance, funded	$ 1,160,000	$ 927,400

XML

Loans and Investments - Narrative (Details) $ in Thousands	1 Months Ended		3 Months Ended				9 Months Ended		12 Months Ended
	Sep. 30, 2023 USD ($) loan	Jul. 31, 2022 USD ($) loan	Sep. 30, 2023 USD ($) loan	Jun. 30, 2023 USD ($) loan	Sep. 30, 2022 USD ($) loan	Jun. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) loan borrower	Sep. 30, 2022 USD ($) loan	Dec. 31, 2022 USD ($) loan borrower	Dec. 31, 2021 USD ($)
Loans and Investments
Number of loans | loan							723		747
Provision for credit losses			$ 15,015		$ 965		$ 51,510	$ 9,055
Accrued interest receivable related to loans	$ 116,400		$ 116,400				$ 116,400		$ 108,500
Number of loans for which no provision for loan loss made | loan	0		0				0		0
Loans and investments, allowance for credit losses	$ 184,069		$ 184,069	$ 169,054	$ 122,296	$ 121,331	$ 184,069	122,296	$ 132,559	$ 113,241
Interest income recognized on nonaccrual loans							2,800	$ 0
Multifamily bridge loan	$ 13,122,395		$ 13,122,395				13,122,395		14,456,123
Interest reserve							$ 125,800		123,700
Loan modification, refinancing, and extensions | loan			0		0		0	0
Number of loans sold | loan							4
Bridge loans, total UPB							$ 293,055		$ 157,960
Number of loans covered under interest reserve | loan	516		516				516		480
Aggregate UPB covered under interest reserve	$ 8,310,000		$ 8,310,000				$ 8,310,000		$ 7,700,000
Bridge loans
Loans and Investments
Number of loans | loan							664		692
Multifamily bridge loan	$ 12,790,972		$ 12,790,972	$ 70,500			$ 12,790,972		$ 14,096,054
Variable rate, spread				3.40%
Financing receivable, fixed interest rate	0.0300
Financing receivable, accrual rate	0.0300
Financing receivable, total fixed rate	0.0600
Financing receivable, borrower required funding	$ 10,500
Interest reserve	2,500
Financing receivable, borrower requirement, capital improvements	$ 8,000
Number of loans sold | loan		4
Bridge loans, total UPB		$ 296,900		$ 182,000			$ 217,400
Capital released		$ 78,000
Unrealized impairment loss						2,000
Number of loans repurchased | loan				2,000,000
Bridge Loan and Mezzanine Loan
Loans and Investments
Bridge loan and mezzanine loans sold						110,500
Loans, purchased with credit deterioration, discount						102,200
Capital released						66,300
Fees and expenses on mortgage loan						9,200
Recovery of additional potential loan						2,800
Six loans collateralized by a land development project
Loans and Investments
Number of loans with unpaid principal balance | loan	6		6				6
Unpaid principal balance on loans	$ 121,400		$ 121,400				$ 121,400
Five loans collateralized by a land development project
Loans and Investments
Number of loans with unpaid principal balance | loan	5		5				5
Unpaid principal balance on loans	$ 112,100		$ 112,100				$ 112,100
Weighted average accrual rate of interest (as a percent)							7.91%
Loans collateralized by a land development project
Loans and Investments
Loans and investments, allowance for credit losses	71,400		71,400				$ 71,400		$ 71,400
Non-performing loans
Loans and Investments
Number of loans | loan							12		4
Carrying value of loans	137,900		137,900				$ 137,900		$ 2,600
Loan loss reserves	12,600		12,600				12,600		5,100
Bridge loans, total UPB							157,862		7,750
Non-performing loans | Greater Than 90 Days Past Due
Loans and Investments
Interest receivable	0		0				0		0
Multifamily bridge loan	35,015		35,015				35,015		7,750
Land
Loans and Investments
Provision for credit losses			60		$ (8)		(106)	$ (60)
Outstanding unfunded commitments	1,080,000		1,080,000				1,080,000		1,150,000
Loans and investments, allowance for credit losses	77,962		77,962	$ 77,902	$ 77,910	$ 77,918	77,962	$ 77,910	78,068	$ 77,970
Bridge loans, total UPB							134,215		$ 134,215
Credit risk concentration
Loans and Investments
Multifamily bridge loan	13,122,395		13,122,395				13,122,395
Credit risk concentration | Land
Loans and Investments
Multifamily bridge loan	$ 136,028		$ 136,028				$ 136,028
Total Assets | Credit risk concentration
Loans and Investments
Number of loans | loan							92		38
Number of different borrowers | borrower							5		5
Total Assets | Credit risk concentration | Five Borrowers
Loans and Investments
Concentration risk, percentage							12.00%		11.00%
Loans and investments portfolio | Credit risk concentration | Texas
Loans and Investments
Concentration risk, percentage							24.00%		22.00%
Loans and investments portfolio | Credit risk concentration | Florida
Loans and Investments
Concentration risk, percentage							16.00%		14.00%

XML

Loans and Investments - Risk Ratings and LTV Ratios (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Loans and Investments
Loans and investments, gross	$ 13,122,395	$ 14,456,123
Percentage of Portfolio	100.00%	100.00%
Wtd. Avg. First Dollar LTV Ratio (as percent)	1.00%	1.00%
Wtd. Avg. Last Dollar LTV Ratio (as percent)	77.00%	76.00%
Credit risk concentration
Loans and Investments
Origination Year 2023	$ 955,334
Origination Year 2022	5,120,395
Origination year 2021	6,002,364
Origination Year 2020	481,079
Origination Year 2019	287,831
Origination Year Prior	275,392
Loans and investments, gross	$ 13,122,395
Wtd. Avg. First Dollar LTV Ratio (as percent)	1.00%
Wtd. Avg. Last Dollar LTV Ratio (as percent)	77.00%
Multifamily | Credit risk concentration
Loans and Investments
Origination Year 2023	$ 771,150
Origination Year 2022	4,631,080
Origination year 2021	5,634,336
Origination Year 2020	326,719
Origination Year 2019	262,866
Origination Year Prior	78,694
Loans and investments, gross	$ 11,704,845
Percentage of Portfolio	89.00%
Wtd. Avg. First Dollar LTV Ratio (as percent)	1.00%
Wtd. Avg. Last Dollar LTV Ratio (as percent)	78.00%
Multifamily | Pass | Credit risk concentration
Loans and Investments
Origination Year 2023	$ 97,186
Origination Year 2022	131,266
Origination year 2021	97,269
Origination Year 2020	2,010
Origination Year Prior	20,300
Loans and investments, gross	348,031
Multifamily | Pass/Watch | Credit risk concentration
Loans and Investments
Origination Year 2023	673,165
Origination Year 2022	2,378,519
Origination year 2021	3,015,502
Origination Year 2020	81,560
Origination Year 2019	112,416
Origination Year Prior	58,394
Loans and investments, gross	6,319,556
Multifamily | Special Mention | Credit risk concentration
Loans and Investments
Origination Year 2023	799
Origination Year 2022	1,830,803
Origination year 2021	2,353,938
Origination Year 2020	219,050
Origination Year 2019	140,685
Origination Year Prior	0
Loans and investments, gross	4,545,275
Multifamily | Substandard | Credit risk concentration
Loans and Investments
Origination Year 2022	290,492
Origination year 2021	153,697
Origination Year 2020	24,099
Origination Year 2019	0
Origination Year Prior	0
Loans and investments, gross	468,288
Multifamily | Doubtful | Credit risk concentration
Loans and Investments
Origination year 2021	13,930
Origination Year 2019	9,765
Loans and investments, gross	23,695
Single-Family Rental | Credit risk concentration
Loans and Investments
Origination Year 2023	184,184
Origination Year 2022	489,315
Origination year 2021	368,028
Origination Year 2020	110,850
Origination Year 2019	20,965
Loans and investments, gross	$ 1,173,342
Percentage of Portfolio	9.00%
Wtd. Avg. First Dollar LTV Ratio (as percent)	0.00%
Wtd. Avg. Last Dollar LTV Ratio (as percent)	63.00%
Single-Family Rental | Pass | Credit risk concentration
Loans and Investments
Origination Year 2023	$ 22,208
Origination year 2021	0
Origination Year 2020	0
Loans and investments, gross	22,208
Single-Family Rental | Pass/Watch | Credit risk concentration
Loans and Investments
Origination Year 2023	161,976
Origination Year 2022	466,391
Origination year 2021	355,176
Origination Year 2020	86,347
Origination Year 2019	20,965
Loans and investments, gross	1,090,855
Single-Family Rental | Special Mention | Credit risk concentration
Loans and Investments
Origination Year 2022	22,924
Origination year 2021	12,852
Origination Year 2020	24,503
Loans and investments, gross	60,279
Land | Credit risk concentration
Loans and Investments
Origination Year 2020	8,100
Origination Year Prior	127,928
Loans and investments, gross	$ 136,028
Percentage of Portfolio	1.00%
Wtd. Avg. First Dollar LTV Ratio (as percent)	0.00%
Wtd. Avg. Last Dollar LTV Ratio (as percent)	98.00%
Land | Pass/Watch | Credit risk concentration
Loans and Investments
Origination Year 2020	$ 4,600
Loans and investments, gross	4,600
Land | Special Mention | Credit risk concentration
Loans and Investments
Origination Year 2020	3,500
Loans and investments, gross	3,500
Land | Substandard | Credit risk concentration
Loans and Investments
Origination Year Prior	127,928
Loans and investments, gross	127,928
Office | Credit risk concentration
Loans and Investments
Origination Year 2020	35,410
Origination Year Prior	45,025
Loans and investments, gross	$ 80,435
Percentage of Portfolio	1.00%
Wtd. Avg. First Dollar LTV Ratio (as percent)	0.00%
Wtd. Avg. Last Dollar LTV Ratio (as percent)	90.00%
Office | Special Mention | Credit risk concentration
Loans and Investments
Origination Year 2020	$ 35,410
Loans and investments, gross	35,410
Office | Substandard | Credit risk concentration
Loans and Investments
Origination Year Prior	45,025
Loans and investments, gross	45,025
Retail | Credit risk concentration
Loans and Investments
Origination Year 2019	4,000
Origination Year Prior	22,045
Loans and investments, gross	$ 26,045
Percentage of Portfolio	1.00%
Wtd. Avg. First Dollar LTV Ratio (as percent)	11.00%
Wtd. Avg. Last Dollar LTV Ratio (as percent)	71.00%
Retail | Pass/Watch | Credit risk concentration
Loans and Investments
Origination Year 2019	$ 4,000
Loans and investments, gross	4,000
Retail | Special Mention | Credit risk concentration
Loans and Investments
Origination Year Prior	3,445
Loans and investments, gross	3,445
Retail | Substandard | Credit risk concentration
Loans and Investments
Origination Year Prior	18,600
Loans and investments, gross	$ 18,600
Other
Loans and Investments
Percentage of Portfolio	1.00%
Other | Credit risk concentration
Loans and Investments
Origination Year Prior	$ 1,700
Loans and investments, gross	$ 1,700
Wtd. Avg. First Dollar LTV Ratio (as percent)	63.00%
Wtd. Avg. Last Dollar LTV Ratio (as percent)	63.00%
Other | Doubtful | Credit risk concentration
Loans and Investments
Origination Year Prior	$ 1,700
Loans and investments, gross	$ 1,700

XML

Loans and Investments - Allowance for Credit Losses (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Allowance for credit losses:
Allowance for credit losses, beginning balance	$ 169,054	$ 121,331	$ 132,559	$ 113,241
Provision for credit losses (net of recoveries)	15,015	965	51,510	9,055
Allowance for credit losses, ending balance	184,069	122,296	184,069	122,296
Multifamily
Allowance for credit losses:
Allowance for credit losses, beginning balance	74,295	27,958	37,961	18,707
Provision for credit losses (net of recoveries)	14,884	(675)	51,218	8,576
Allowance for credit losses, ending balance	89,179	27,283	89,179	27,283
Land
Allowance for credit losses:
Allowance for credit losses, beginning balance	77,902	77,918	78,068	77,970
Provision for credit losses (net of recoveries)	60	(8)	(106)	(60)
Allowance for credit losses, ending balance	77,962	77,910	77,962	77,910
Office
Allowance for credit losses:
Allowance for credit losses, beginning balance	8,246	7,031	8,162	8,073
Provision for credit losses (net of recoveries)	(76)	306	8	(736)
Allowance for credit losses, ending balance	8,170	7,337	8,170	7,337
Retail
Allowance for credit losses:
Allowance for credit losses, beginning balance	5,819	5,819	5,819	5,819
Allowance for credit losses, ending balance	5,819	5,819	5,819	5,819
Commercial
Allowance for credit losses:
Allowance for credit losses, beginning balance	1,700	1,700	1,700	1,700
Allowance for credit losses, ending balance	1,700	1,700	1,700	1,700
Single-Family Rental
Allowance for credit losses:
Allowance for credit losses, beginning balance	1,077	725	781	320
Provision for credit losses (net of recoveries)	162	1,326	458	1,731
Allowance for credit losses, ending balance	1,239	2,051	1,239	2,051
Other
Allowance for credit losses:
Allowance for credit losses, beginning balance	15	180	68	652
Provision for credit losses (net of recoveries)	(15)	16	(68)	(456)
Allowance for credit losses, ending balance	$ 0	$ 196	$ 0	$ 196

XML

Loans and Investments - Summary of impaired loans (Details) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2023 USD ($) loan	Dec. 31, 2022 USD ($) loan
Loans and Investments
UPB	$ 293,055	$ 157,960
Carrying Value	280,258	147,131
Allowance for Credit Losses	$ 111,087	$ 85,386
Wtd. Avg. First Dollar LTV Ratio	0.01	0.03
Wtd. Avg. Last Dollar LTV Ratio	0.97	0.96
Number of impaired loans (less unearned revenue and other holdbacks and adjustments) by asset class | loan	13	7
Land
Loans and Investments
UPB	$ 134,215	$ 134,215
Carrying Value	127,868	127,868
Allowance for Credit Losses	$ 77,869	$ 77,869
Wtd. Avg. First Dollar LTV Ratio	0	0
Wtd. Avg. Last Dollar LTV Ratio	0.99	0.99
Multifamily
Loans and Investments
UPB	$ 90,070
Carrying Value	87,995
Allowance for Credit Losses	$ 17,750
Wtd. Avg. First Dollar LTV Ratio	0
Wtd. Avg. Last Dollar LTV Ratio	1
Office
Loans and Investments
UPB	$ 45,025
Carrying Value	45,025
Allowance for Credit Losses	$ 7,951
Wtd. Avg. First Dollar LTV Ratio	0
Wtd. Avg. Last Dollar LTV Ratio	0.99
Retail
Loans and Investments
UPB	$ 22,045	$ 22,045
Carrying Value	17,670	17,563
Allowance for Credit Losses	$ 5,817	$ 5,817
Wtd. Avg. First Dollar LTV Ratio	0.13	0.14
Wtd. Avg. Last Dollar LTV Ratio	0.78	0.79
Commercial
Loans and Investments
UPB	$ 1,700	$ 1,700
Carrying Value	1,700	1,700
Allowance for Credit Losses	$ 1,700	$ 1,700
Wtd. Avg. First Dollar LTV Ratio	0.63	0.63
Wtd. Avg. Last Dollar LTV Ratio	0.63	0.63

XML

Loans and Investments - Non-performing loans (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
Loans and Investments
UPB	$ 293,055	$ 157,960
Loans and investments, gross	13,122,395	14,456,123
Non-performing loans
Loans and Investments
UPB	157,862	7,750
Less Than 90 Days Past Due | Non-performing loans
Loans and Investments
Loans and investments, gross	122,847	0
Greater Than 90 Days Past Due | Non-performing loans
Loans and Investments
Loans and investments, gross	35,015	7,750
Multifamily
Loans and Investments
UPB	90,070
Multifamily | Non-performing loans
Loans and Investments
UPB	152,717	2,605
Multifamily | Less Than 90 Days Past Due | Non-performing loans
Loans and Investments
Loans and investments, gross	122,847	0
Multifamily | Greater Than 90 Days Past Due | Non-performing loans
Loans and Investments
Loans and investments, gross	29,870	2,605
Retail
Loans and Investments
UPB	22,045	22,045
Retail | Non-performing loans
Loans and Investments
UPB	3,445	3,445
Retail | Less Than 90 Days Past Due | Non-performing loans
Loans and Investments
Loans and investments, gross	0	0
Retail | Greater Than 90 Days Past Due | Non-performing loans
Loans and Investments
Loans and investments, gross	3,445	3,445
Commercial
Loans and Investments
UPB	1,700	1,700
Commercial | Non-performing loans
Loans and Investments
UPB	1,700	1,700
Commercial | Less Than 90 Days Past Due | Non-performing loans
Loans and Investments
Loans and investments, gross	0	0
Commercial | Greater Than 90 Days Past Due | Non-performing loans
Loans and Investments
Loans and investments, gross	$ 1,700	$ 1,700

XML

Loans Held-for-Sale, Net (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Loans Held-for-Sale, Net
Loans held-for-sale	$ 368,330	$ 368,066
Fair value of future MSR	4,302	5,557
Unrealized impairment loss	(2,891)	(15,703)
Unearned discount	(5,421)	(3,850)
Loans held-for-sale, net	364,320	354,070
Fannie Mae
Loans Held-for-Sale, Net
Loans held-for-sale, net	257,371	173,020
Freddie Mac
Loans Held-for-Sale, Net
Loans held-for-sale	86,089	8,938
Private Label
Loans Held-for-Sale, Net
Loans held-for-sale, net	11,350	152,735
SFR - Fixed Rate
Loans Held-for-Sale, Net
Loans held-for-sale, net	8,710	12,352
FHA
Loans Held-for-Sale, Net
Loans held-for-sale	$ 4,810	$ 21,021

XML

Loans Held-for-Sale, Net - Narrative (Details)	3 Months Ended				9 Months Ended		12 Months Ended
	Sep. 30, 2023 USD ($)	Mar. 31, 2023 USD ($)	Sep. 30, 2022 USD ($)	Jun. 30, 2022 USD ($)	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($) loan
Loans Held-for-Sale, Net
Sale of loans held-for-sale excluding acquired loans	$ 1,280,000,000		$ 1,080,000,000.00		$ 3,620,000,000	$ 3,700,000,000
Amount of securitizations							$ 43,400,000
Unrealized impairment loss				$ 4,100,000	2,891,000
Loans held-for-sale placed on non-accrual status	0				0		0
Greater Than 90 Days Past Due
Loans Held-for-Sale, Net
Loans held-for-sale that were 90 days or more past due	$ 0				$ 0		0
US Government Sponsored-Enterprise Insured Loans
Loans Held-for-Sale, Net
Period of loans held for sale sold					60 days
Private Label
Loans Held-for-Sale, Net
Period of loans held for sale sold					180 days
Sale of loans held-for-sale excluding acquired loans							489,300,000
Net loss of swaps gain with loans							$ 5,200,000
Number of loans under the loan portfolio | loan							7
Unpaid principal balance							$ 129,900,000
Net loans carrying value							$ 116,400,000
Gain on sale of loans		$ 900,000

XML

Capitalized Mortgage Servicing Rights - Narrative (Details) - MSRs - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Capitalized Mortgage Servicing Rights
Prepayment fees collected	$ 1,000,000	$ 11,200,000	$ 6,100,000	$ 42,600,000
Valuation allowance	$ 0		$ 0		$ 0
Minimum
Capitalized Mortgage Servicing Rights
Discount rate, percentage			8.00%
Maximum
Capitalized Mortgage Servicing Rights
Discount rate, percentage			13.00%
Weighted average
Capitalized Mortgage Servicing Rights
Discount rate, percentage			12.00%
Estimated life remaining	8 years 3 months 18 days		8 years 3 months 18 days		8 years 7 months 6 days

XML

Capitalized Mortgage Servicing Rights - Summary of Capitalized MSRs (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Capitalized Mortgage Servicing Rights
Beginning balance			$ 401,471
Ending balance	$ 392,203		392,203
MSRs
Capitalized Mortgage Servicing Rights
Beginning balance	394,410	$ 411,534	401,471	$ 422,734
Additions	16,550	18,907	49,416	63,002
Amortization	(15,900)	(14,782)	(46,920)	(44,532)
Write-downs and payoffs	(2,857)	(11,773)	(11,764)	(37,318)
Ending balance	392,203	403,886	392,203	403,886
Expected amortization of capitalized MSRs balances
2023 (three months ending 12/31/2023)	16,169		16,169
2024	63,855		63,855
2025	60,481		60,481
2026	54,479		54,479
2027	49,654		49,654
2028	43,110		43,110
Thereafter	104,455		104,455
Total	392,203		392,203
Originated
Capitalized Mortgage Servicing Rights
Beginning balance	383,267	391,397	386,878	395,573
Additions	16,550	18,907	49,416	63,002
Amortization	(14,988)	(13,355)	(43,866)	(39,348)
Write-downs and payoffs	(2,400)	(9,957)	(9,999)	(32,235)
Ending balance	382,429	386,992	382,429	386,992
Acquired
Capitalized Mortgage Servicing Rights
Beginning balance	11,143	20,137	14,593	27,161
Amortization	(912)	(1,427)	(3,054)	(5,184)
Write-downs and payoffs	(457)	(1,816)	(1,765)	(5,083)
Ending balance	$ 9,774	$ 16,894	$ 9,774	$ 16,894

XML

Mortgage Servicing - Schedule of Product and Geographic Concentration (Details) - MSRs $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2023 USD ($) state	Dec. 31, 2022 USD ($) state
Mortgage Servicing
Product Concentrations, UPB	$ 29,936,707	$ 27,998,029
Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	100.00%	100.00%
Texas | Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	11.00%	11.00%
New York | Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	11.00%	11.00%
North Carolina | Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	8.00%	8.00%
California | Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	8.00%	8.00%
Georgia | Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	6.00%	6.00%
Florida | Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	6.00%	5.00%
New Jersey | Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	5.00%	5.00%
Illinois | Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	4.00%	4.00%
Other | Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	41.00%	42.00%
Number of states | state	0	0
Fannie Mae
Mortgage Servicing
Product Concentrations, UPB	$ 20,463,620	$ 19,038,124
Fannie Mae | Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	68.00%	68.00%
Freddie Mac
Mortgage Servicing
Product Concentrations, UPB	$ 5,184,888	$ 5,153,207
Freddie Mac | Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	17.00%	18.00%
Private Label
Mortgage Servicing
Product Concentrations, UPB	$ 2,371,475	$ 2,074,859
Private Label | Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	8.00%	8.00%
FHA
Mortgage Servicing
Product Concentrations, UPB	$ 1,322,832	$ 1,155,893
FHA | Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	5.00%	4.00%
Bridge
Mortgage Servicing
Product Concentrations, UPB	$ 305,950	$ 301,182
Bridge | Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	1.00%	1.00%
SFR - Fixed Rate
Mortgage Servicing
Product Concentrations, UPB	$ 287,942	$ 274,764
SFR - Fixed Rate | Fee-based servicing portfolio
Mortgage Servicing
Product Concentrations, % of Total	1.00%	1.00%

XML

Mortgage Servicing - Narrative (Details) - USD ($) $ in Billions	9 Months Ended	12 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
Mortgage Servicing
Escrow balance	$ 1.6	$ 1.5
Fee-based servicing portfolio
Mortgage Servicing
Escrow balance	$ 1.7	$ 1.7
MSRs | Agency Business
Mortgage Servicing
Weighted average servicing fee rate (basis points)	0.397%	0.411%

XML

Mortgage Servicing - Components of Servicing Revenue, Net (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Transfers and Servicing [Abstract]
Servicing fees	$ 32,191	$ 30,631	$ 92,479	$ 93,702
Interest earned on escrows	20,985	7,450	57,501	10,073
Prepayment fees	1,044	11,218	6,080	42,588
Write-offs of MSRs	(2,857)	(11,773)	(11,764)	(37,318)
Amortization of MSRs	(15,900)	(14,782)	(46,920)	(44,532)
Servicing revenue, net	$ 35,463	$ 22,744	$ 97,376	$ 64,513

XML

Securities Held-To-Maturity - Narrative (Details) $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) bond	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)
Schedule of Held-to-Maturity Securities [Line Items]
Held-to-maturity securities, face value	$ 231,577		$ 231,577		$ 234,255
Interest income, including the amortization of discount	3,600	$ 3,700	10,700	$ 13,900
APL certificates
Schedule of Held-to-Maturity Securities [Line Items]
Held-to-maturity securities, face value	192,791		192,791		$ 192,791
Amount purchased at a discount	$ 119,000		$ 119,000
Weighted average variable interest rate (as a percent)	3.94%		3.94%
Estimated weighted average remaining maturity period			6 years 9 months 18 days
Weighted average fixed interest rate			8.85%		8.85%
After one year through five years	$ 18,200		$ 18,200
After five years through ten years	$ 174,600		$ 174,600
APL certificates | Minimum
Schedule of Held-to-Maturity Securities [Line Items]
Securities maturity term			5 years
APL certificates | Maximum
Schedule of Held-to-Maturity Securities [Line Items]
Securities maturity term			10 years
Seven B Piece Bonds
Schedule of Held-to-Maturity Securities [Line Items]
Estimated weighted average remaining maturity period			5 years 10 months 24 days
Bonds retained percentage			49.00%
Initial face value of bonds purchased			$ 106,200
Number of B Piece bonds | bond			7
Discounted value of bonds purchased			$ 74,700
Held-to-maturity securities sold, percentage	51.00%		51.00%
Agency B Piece Bonds
Schedule of Held-to-Maturity Securities [Line Items]
Weighted average variable interest rate (as a percent)	3.74%		3.74%		12.20%
After one year through five years	$ 14,800		$ 14,800
Weighted average effective interest rate (as a percent)	11.19%		11.19%
Within one year	$ 7,500		$ 7,500
After ten years	$ 16,500		$ 16,500

XML

Securities Held-To-Maturity - Summary of Securities Held-To-Maturity (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Jun. 30, 2023	Dec. 31, 2022
Securities Held-to-Maturity
Face Value	$ 231,577		$ 234,255
Net Carrying Value	155,172		156,547
Unrealized Loss	(28,564)		(11,976)
Estimated Fair Value	126,608		144,571
Allowance for Credit Losses	5,943	$ 4,534	3,153
APL certificates
Securities Held-to-Maturity
Face Value	192,791		192,791
Net Carrying Value	127,547		123,475
Unrealized Loss	(33,337)		(13,348)
Estimated Fair Value	94,210		110,127
Allowance for Credit Losses	2,340	3,375	2,783
B Piece bonds
Securities Held-to-Maturity
Face Value	38,786		41,464
Net Carrying Value	27,625		33,072
Unrealized Gain	4,773		1,372
Estimated Fair Value	32,398		34,444
Allowance for Credit Losses	$ 3,603	$ 1,159	$ 370

XML

Securities Held-To-Maturity - Rollforward of Allowance (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2023
Changes in the allowance for credit losses
Allowance for credit loss, Beginning balance	$ 4,534	$ 3,153
Provision for credit loss expense/(reversal)	1,409	2,790
Allowance for credit loss, Ending balance	5,943	5,943
APL certificates
Changes in the allowance for credit losses
Allowance for credit loss, Beginning balance	3,375	2,783
Provision for credit loss expense/(reversal)	(1,035)	(443)
Allowance for credit loss, Ending balance	2,340	2,340
B Piece bonds
Changes in the allowance for credit losses
Allowance for credit loss, Beginning balance	1,159	370
Provision for credit loss expense/(reversal)	2,444	3,233
Allowance for credit loss, Ending balance	$ 3,603	$ 3,603

XML

Investments in Equity Affiliates - Summary of Equity Method Investments (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Investment in Equity Affiliates
Investment in Equity Affiliates	$ 62,795	$ 79,130
UPB of Loans to Equity Affiliates	1,688
Arbor Residential Investor LLC
Investment in Equity Affiliates
Investment in Equity Affiliates	33,447	46,951
Fifth Wall Ventures
Investment in Equity Affiliates
Investment in Equity Affiliates	13,422	13,584
AMAC Holdings III LLC
Investment in Equity Affiliates
Investment in Equity Affiliates	13,156	15,825
Lightstone Value Plus REIT L.P.
Investment in Equity Affiliates
Investment in Equity Affiliates	1,895	1,895
Docsumo Pte. Ltd.
Investment in Equity Affiliates
Investment in Equity Affiliates	450	450
JT Prime
Investment in Equity Affiliates
Investment in Equity Affiliates	425	$ 425
West Shore Café
Investment in Equity Affiliates
UPB of Loans to Equity Affiliates	$ 1,688

XML

Investments in Equity Affiliates - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Investment in Equity Affiliates
Income (loss) from equity affiliates	$ 809	$ 4,748	$ 20,694	$ 18,507
Indirect ownership percentage			9.20%
Arbor Residential Investor LLC
Investment in Equity Affiliates
Income (loss) from equity affiliates	(1,300)	300	$ 1,300	6,400
Indirect ownership percentage			12.30%
Arbor Residential Investor LLC | Other Related Party Transactions
Investment in Equity Affiliates
Distribution from investment classified as return capital	7,500	7,300	$ 15,000	22,300
Fifth Wall Ventures
Investment in Equity Affiliates
Distribution from investment classified as return capital		700		1,600
Noncontrolling interest			800	8,700
Loss on investment	800		1,000
AMAC Holdings III LLC
Investment in Equity Affiliates
Noncontrolling interest					$ 4,900
Loss on investment	700	700	1,600	1,800
Distribution received		200	1,100	400
Lexford Portfolio
Investment in Equity Affiliates
Distribution received		5,000	7,200	$ 11,000
Equity Participation Interest
Investment in Equity Affiliates
Proceeds from sale	$ 3,500	$ 2,600	$ 14,500

XML

Debt Obligations - Credit and Repurchase Facilities (Details) - USD ($) $ in Thousands	1 Months Ended						9 Months Ended
	Jun. 30, 2024	Dec. 31, 2023	Aug. 31, 2023	Jul. 31, 2023	Apr. 30, 2023	Mar. 31, 2023	Sep. 30, 2023	Mar. 01, 2024	Jul. 01, 2023	Jun. 30, 2023	Dec. 31, 2022
Debt Obligations
Debt Carrying Value							$ 3,391,441				$ 3,841,814
Collateral Carrying Value							$ 4,731,093				5,185,293
Wtd. Avg. Note Rate							7.59%
Outstanding principal balance repaid							$ 44,400
Repurchase Facility
Debt Obligations
Line of credit facility, committed amount							514,500
Repurchase facility - securities | B Piece bonds
Debt Obligations
Collateral Carrying Value											33,100
Structured Business
Debt Obligations
Debt Carrying Value							3,036,855				3,536,371
Collateral Carrying Value							$ 4,370,593				4,845,753
Wtd. Avg. Note Rate							7.70%
Deferred financing fees							$ 6,600				$ 13,300
Weighted average note rate including certain fees and costs, percentage							8.14%				6.95%
Leverage on loans and investment portfolio financed through credit and repurchase facilities, excluding securities repurchase facility and working capital facility							69.00%				73.00%
Structured Business | Forecast | Minimum
Debt Obligations
Weighted average loan spread		0.0240
Structured Business | $2.5B joint repurchase facility
Debt Obligations
Maximum borrowing capacity							$ 2,500,000
Debt Carrying Value							923,599				$ 1,516,657
Collateral Carrying Value							$ 1,438,971				2,099,447
Wtd. Avg. Note Rate							7.72%
Structured Business | $1B repurchase facility
Debt Obligations
Maximum borrowing capacity			$ 1,000,000				$ 1,000,000
Debt Carrying Value							418,206				498,666
Collateral Carrying Value							$ 621,759				703,740
Wtd. Avg. Note Rate							7.58%
Structured Business | $1B repurchase facility | SOFR
Debt Obligations
Variable rate, spread			2.50%
Structured Business | $1B repurchase facility | SOFR | Forecast
Debt Obligations
Variable rate, spread	2.50%	2.25%
Structured Business | $500M repurchase facility
Debt Obligations
Maximum borrowing capacity							$ 500,000
Debt Carrying Value							374,072				154,653
Collateral Carrying Value							$ 505,139				188,563
Wtd. Avg. Note Rate							8.34%
Expiration period after the lender provides written notice							6 months
Additional period to repurchase the underlying loans							6 months
Structured Business | $499M repurchase facility
Debt Obligations
Maximum borrowing capacity							$ 499,000
Debt Carrying Value							343,726				351,056
Collateral Carrying Value							$ 491,190				504,506
Wtd. Avg. Note Rate							7.67%
Structured Business | $450M repurchase facility
Debt Obligations
Maximum borrowing capacity						$ 450,000	$ 450,000
Debt Carrying Value							328,650				344,237
Collateral Carrying Value							$ 452,318				450,736
Wtd. Avg. Note Rate							7.50%
Structured Business | $450M repurchase facility | SOFR
Debt Obligations
Variable rate, spread						2.00%
Structured Business | $450M repurchase facility
Debt Obligations
Maximum borrowing capacity							$ 450,000
Debt Carrying Value							93,410				186,639
Collateral Carrying Value							$ 120,947				239,678
Wtd. Avg. Note Rate							7.01%
Structured Business | $250M credit facility
Debt Obligations
Maximum borrowing capacity							$ 250,000		$ 250,000
Debt Carrying Value							18,438				33,221
Collateral Carrying Value							$ 23,088				43,238
Wtd. Avg. Note Rate							7.28%
Structured Business | $250M credit facility | Multifamily | SOFR
Debt Obligations
Variable rate, spread				2.50%
Structured Business | $250M credit facility | Non-Multifamily Loans | SOFR
Debt Obligations
Variable rate, spread				3.20%
Structured Business | $250M credit facility | Non-Multifamily Loans | SOFR | Minimum
Debt Obligations
Variable rate, spread				2.95%
Structured Business | $225M credit facility
Debt Obligations
Maximum borrowing capacity							$ 225,000
Debt Carrying Value							94,913				47,398
Collateral Carrying Value							$ 148,041				81,119
Wtd. Avg. Note Rate							7.97%
Structured Business | $200M repurchase facility
Debt Obligations
Maximum borrowing capacity							$ 200,000
Debt Carrying Value							73,751				32,494
Collateral Carrying Value							$ 105,076				47,750
Wtd. Avg. Note Rate							7.97%
Structured Business | $200M repurchase facility
Debt Obligations
Maximum borrowing capacity							$ 200,000
Debt Carrying Value							115,748				154,516
Collateral Carrying Value							$ 151,890				200,099
Wtd. Avg. Note Rate							7.36%
Structured Business | $174M loan specific credit facilities
Debt Obligations
Maximum borrowing capacity							$ 174,000
Debt Carrying Value							173,862				156,107
Collateral Carrying Value							$ 251,049				225,805
Wtd. Avg. Note Rate							7.45%
Structured Business | $50M credit facility
Debt Obligations
Maximum borrowing capacity							$ 50,000
Debt Carrying Value							29,200				29,194
Collateral Carrying Value							$ 36,500				36,500
Wtd. Avg. Note Rate							7.51%
Structured Business | $40M credit facility
Debt Obligations
Maximum borrowing capacity					$ 40,000		$ 40,000
Debt Carrying Value							0				0
Collateral Carrying Value							$ 0				0
Wtd. Avg. Note Rate							0.00%
Structured Business | $35M working capital facility
Debt Obligations
Maximum borrowing capacity							$ 35,000
Debt Carrying Value							0				0
Collateral Carrying Value							$ 0				0
Wtd. Avg. Note Rate							0.00%
Structured Business | $25M credit facility
Debt Obligations
Maximum borrowing capacity							$ 25,000
Debt Carrying Value							18,248				18,701
Collateral Carrying Value							$ 24,625				24,572
Wtd. Avg. Note Rate							8.02%
Total committed amount					$ 25,000
Structured Business | Repurchase facility - securities
Debt Obligations
Debt Carrying Value							$ 31,032				12,832
Collateral Carrying Value							$ 0				0
Wtd. Avg. Note Rate							7.11%
Structured Business | $400M credit facility
Debt Obligations
Maximum borrowing capacity										$ 400,000
Structured and Agency Business | $3 Billion joint repurchase facility
Debt Obligations
Maximum borrowing capacity				$ 3,000,000
Structured and Agency Business | $2 Billion Joint Repurchase Facility | Forecast
Debt Obligations
Maximum borrowing capacity								$ 2,000,000
Agency Business
Debt Obligations
Debt Carrying Value							$ 354,586				305,443
Collateral Carrying Value							$ 360,500				339,540
Wtd. Avg. Note Rate							6.69%
Deferred financing fees							$ 500				900
Agency Business | $500M repurchase facility
Debt Obligations
Maximum borrowing capacity							500,000
Debt Carrying Value							144,818				66,778
Collateral Carrying Value							$ 145,618				66,866
Wtd. Avg. Note Rate							6.69%
Agency Business | $200M repurchase facility
Debt Obligations
Maximum borrowing capacity							$ 200,000
Debt Carrying Value							143,654				31,475
Collateral Carrying Value							$ 144,168				33,177
Wtd. Avg. Note Rate							6.71%
Total committed amount						$ 200,000
Agency Business | $200M repurchase facility | SOFR
Debt Obligations
Variable rate, spread						1.40%
Agency Business | $50M credit facility
Debt Obligations
Maximum borrowing capacity							$ 50,000
Debt Carrying Value							3,264				14,664
Collateral Carrying Value							$ 3,264				14,671
Wtd. Avg. Note Rate							6.66%
Agency Business | $750M ASAP agreement
Debt Obligations
Maximum borrowing capacity							$ 750,000
Debt Carrying Value							54,618				29,476
Collateral Carrying Value							$ 55,220				30,291
Wtd. Avg. Note Rate							6.46%
Agency Business | $500M joint repurchase facility
Debt Obligations
Maximum borrowing capacity							$ 500,000
Debt Carrying Value							7,701				104,629
Collateral Carrying Value							$ 11,350				135,641
Wtd. Avg. Note Rate							7.74%
Agency Business | $100M credit facility
Debt Obligations
Maximum borrowing capacity							$ 100,000
Debt Carrying Value							0				57,887
Collateral Carrying Value							$ 0				57,974
Wtd. Avg. Note Rate							0.00%
Agency Business | $1M repurchase facility
Debt Obligations
Maximum borrowing capacity							$ 1,000
Debt Carrying Value							531				534
Collateral Carrying Value							$ 880				$ 920
Wtd. Avg. Note Rate							7.67%

XML

Debt Obligations - Collateralized Loan Obligations (Details) $ in Thousands	3 Months Ended				9 Months Ended		12 Months Ended
	Sep. 30, 2023 USD ($) loan	Jun. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Mar. 31, 2022 USD ($)	Sep. 30, 2023 USD ($) loan	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)
Debt Obligations
Debt, Carrying Value	$ 7,004,634				$ 7,004,634		$ 7,849,270
Debt, Wtd. Avg. Rate	7.59%				7.59%
Payoffs and paydowns of collateralized loan obligations					$ 856,864	$ 441,000
Loss on extinguishment of debt	$ 314		$ 3,262		1,561	$ 4,612
Collateralized loan obligations
Debt Obligations
Debt, Face Value	6,807,136				6,807,136		7,649,188
Debt, Carrying Value	$ 6,784,544				$ 6,784,544		$ 7,615,364
Debt, Wtd. Avg. Rate	7.08%				7.08%		6.10%
Collateral, Loans, UPB	$ 7,695,762				$ 7,695,762		$ 8,619,210
Collateral, Loans, Carrying Value	7,673,865				7,673,865		8,586,139
Collateral, Cash, Restricted Cash	299,784				299,784		480,817
Deferred financing fees	$ 24,600				$ 24,600		36,800
Number of loans under the loan portfolio | loan	4				4
Collateral at risk	$ 89,800				$ 89,800		0
Proceeds from issuance of collateralized loan obligations for acquiring additional loan obligations					108,500		230,000
Loss on extinguishment of debt				$ 1,400
CLO 19
Debt Obligations
Debt, Face Value	872,812				872,812		872,812
Debt, Carrying Value	$ 867,904				$ 867,904		$ 866,605
Debt, Wtd. Avg. Rate	7.77%				7.77%		6.75%
Collateral, Loans, UPB	$ 1,014,554				$ 1,014,554		$ 952,268
Collateral, Loans, Carrying Value	1,010,753				1,010,753		947,336
Collateral, Cash, Restricted Cash	4,527				4,527		64,300
CLO 18
Debt Obligations
Debt, Face Value	1,652,812				1,652,812		1,652,812
Debt, Carrying Value	$ 1,647,326				$ 1,647,326		$ 1,645,711
Debt, Wtd. Avg. Rate	7.22%				7.22%		6.19%
Collateral, Loans, UPB	$ 1,908,793				$ 1,908,793		$ 1,899,174
Collateral, Loans, Carrying Value	1,903,837				1,903,837		1,891,215
Collateral, Cash, Restricted Cash	20,983				20,983		85,970
CLO 17
Debt Obligations
Debt, Face Value	1,714,125				1,714,125		1,714,125
Debt, Carrying Value	$ 1,709,255				$ 1,709,255		$ 1,707,676
Debt, Wtd. Avg. Rate	7.10%				7.10%		6.16%
Collateral, Loans, UPB	$ 1,901,897				$ 1,901,897		$ 1,911,866
Collateral, Loans, Carrying Value	1,896,347				1,896,347		1,904,732
Collateral, Cash, Restricted Cash	149,206				149,206		145,726
CLO 16
Debt Obligations
Debt, Face Value	1,237,500				1,237,500		1,237,500
Debt, Carrying Value	$ 1,233,286				$ 1,233,286		$ 1,231,887
Debt, Wtd. Avg. Rate	6.73%				6.73%		5.79%
Collateral, Loans, UPB	$ 1,343,886				$ 1,343,886		$ 1,307,244
Collateral, Loans, Carrying Value	1,340,303				1,340,303		1,301,794
Collateral, Cash, Restricted Cash	91,434				91,434		106,495
CLO 15
Debt Obligations
Debt, Face Value	674,412				674,412		674,412
Debt, Carrying Value	$ 672,897				$ 672,897		$ 671,532
Debt, Wtd. Avg. Rate	6.78%				6.78%		5.84%
Collateral, Loans, UPB	$ 770,602				$ 770,602		$ 797,755
Collateral, Loans, Carrying Value	768,436				768,436		795,078
Collateral, Cash, Restricted Cash	19,714				19,714		2,861
CLO 14
Debt Obligations
Debt, Face Value	655,475				655,475		655,475
Debt, Carrying Value	$ 653,876				$ 653,876		$ 652,617
Debt, Wtd. Avg. Rate	6.74%				6.74%		5.80%
Collateral, Loans, UPB	$ 756,030				$ 756,030		$ 732,247
Collateral, Loans, Carrying Value	754,189				754,189		730,057
Collateral, Cash, Restricted Cash	13,920				13,920		37,090
CLO 13
Debt Obligations
Debt, Face Value							462,769
Debt, Carrying Value							$ 461,005
Debt, Wtd. Avg. Rate							6.03%
Collateral, Loans, UPB							$ 552,182
Collateral, Loans, Carrying Value							550,924
Collateral, Cash, Restricted Cash							37,875
Payoffs and paydowns of collateralized loan obligations		$ 1,200
CLO 12
Debt Obligations
Debt, Face Value							379,283
Debt, Carrying Value							$ 378,331
Debt, Wtd. Avg. Rate							6.09%
Collateral, Loans, UPB							$ 466,474
Collateral, Loans, Carrying Value							465,003
Collateral, Cash, Restricted Cash							500
Payoffs and paydowns of collateralized loan obligations	300
Q Series securitization
Debt Obligations
Debt, Face Value	222,066				222,066		236,878
Debt, Carrying Value	$ 220,090				$ 220,090		$ 233,906
Debt, Wtd. Avg. Rate	7.31%				7.31%		6.30%
Collateral, Loans, UPB	$ 296,088				$ 296,088		$ 315,837
Collateral, Loans, Carrying Value	294,876				294,876		313,965
Collateral, Cash, Restricted Cash	0				0		0
Total securitized debt
Debt Obligations
Debt, Face Value	7,029,202				7,029,202		7,886,066
Debt, Carrying Value	$ 7,004,634				$ 7,004,634		$ 7,849,270
Debt, Wtd. Avg. Rate	7.09%				7.09%		6.11%
Collateral, Loans, UPB	$ 7,991,850				$ 7,991,850		$ 8,935,047
Collateral, Loans, Carrying Value	7,968,741				7,968,741		8,900,104
Collateral, Cash, Restricted Cash	$ 299,784				$ 299,784		$ 480,817
Weighted average note rate including certain fees and costs, percentage	7.34%				7.34%		6.32%

XML

Debt Obligations - Senior Unsecured Notes (Details) - USD ($) $ in Thousands	1 Months Ended	9 Months Ended
	Mar. 31, 2023	Sep. 30, 2023	May 31, 2023	Dec. 31, 2022	Sep. 30, 2022
Debt Obligations
Wtd. Avg. Note Rate		7.59%
Redemption of aggregate principal amount, percentage		100.00%
7.75% Notes
Debt Obligations
Interest rate		7.75%
Debt, Face Value		$ 95,000		$ 0
Carrying value		$ 93,552		$ 0
Wtd. Avg. Note Rate		7.75%		0.00%
8.50% Notes
Debt Obligations
Interest rate		8.50%
Debt, Face Value		$ 150,000		$ 150,000
Carrying value		$ 147,904		$ 147,519
Wtd. Avg. Note Rate		8.50%		8.50%
5.00% Notes
Debt Obligations
Interest rate		5.00%
Debt, Face Value		$ 180,000		$ 180,000
Carrying value		$ 177,769		$ 177,450
Wtd. Avg. Note Rate		5.00%		5.00%
4.50% Notes
Debt Obligations
Interest rate		4.50%
Debt, Face Value		$ 270,000		$ 270,000
Carrying value		$ 267,555		$ 266,926
Wtd. Avg. Note Rate		4.50%		4.50%
5.00% Notes
Debt Obligations
Interest rate		5.00%
Debt, Face Value		$ 175,000		$ 175,000
Carrying value		$ 173,386		$ 172,917
Wtd. Avg. Note Rate		5.00%		5.00%
4.50% Notes
Debt Obligations
Interest rate		4.50%
Debt, Face Value		$ 275,000		$ 275,000
Carrying value		$ 273,322		$ 272,960
Wtd. Avg. Note Rate		4.50%		4.50%
4.75% Notes
Debt Obligations
Interest rate		4.75%			4.75%
Debt, Face Value		$ 110,000		$ 110,000
Carrying value		$ 109,633		$ 109,369
Wtd. Avg. Note Rate		4.75%		4.75%
5.75% Notes
Debt Obligations
Interest rate		5.75%
Debt, Face Value		$ 90,000		$ 90,000
Carrying value		$ 89,805		$ 89,514
Wtd. Avg. Note Rate		5.75%		5.75%
8.00% Notes
Debt Obligations
Interest rate		8.00%
Debt, Face Value		$ 0		$ 70,750
Carrying value		$ 0		$ 70,613
Wtd. Avg. Note Rate		0.00%		8.00%
5.625% Notes
Debt Obligations
Interest rate		5.625%	5.625%
Debt, Face Value		$ 0		$ 78,850
Carrying value		$ 0		$ 78,726
Wtd. Avg. Note Rate		0.00%		5.63%
Senior unsecured notes
Debt Obligations
Debt, Face Value		$ 1,345,000		$ 1,399,600
Carrying value		$ 1,332,926		$ 1,385,994
Wtd. Avg. Note Rate		5.41%		5.40%
Deferred financing fees		$ 12,100		$ 13,600
Weighted average note rate including certain fees and costs, percentage		5.70%		5.69%
7.75% senior unsecured notes
Debt Obligations
Interest rate	7.75%
Carrying value	$ 95,000
Senior Unsecured Notes
Debt Obligations
Interest rate	8.00%
Proceeds from issuance of unsecured notes	$ 93,400
Amount utilized to repurchase a portion of unsecured notes	$ 70,800

XML

Debt Obligations - Convertible Senior Unsecured Notes (Details) $ / shares in Units, $ in Thousands	1 Months Ended	3 Months Ended			9 Months Ended
	Jun. 30, 2023	Sep. 30, 2023 USD ($) $ / shares	Dec. 31, 2022 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) $ / shares	Sep. 30, 2022 USD ($)
Debt Obligations
Total		$ 12,214,489			$ 12,214,489
Loss on extinguishment of debt		314		$ 3,262	$ 1,561	$ 4,612
Convertible senior unsecured notes
Debt Obligations
Percentage of notes required to be repurchased if the agreement is fundamentally changed					100.00%
Debt, Face Value		287,500	$ 287,500		$ 287,500
Unamortized Deferred Financing Fees		5,072	7,144		5,072
Total		282,428	$ 280,356		282,428
Interest expense		6,100		5,800	18,200	13,400
Interest expense related to cash coupon		5,400		5,000	16,100	11,300
Deferred fees expensed as interest expense		$ 700		$ 800	$ 2,100	$ 2,100
Weighted average cost of notes, percentage		8.42%	8.42%		8.42%
7.50% convertible notes
Debt Obligations
Interest rate		7.50%			7.50%
Conversion rate of the notes to common stock, per $1,000 principal amount of notes	60.2170
Conversion price per share of common stock (in dollars per share) | $ / shares		$ 16.61			$ 16.61
7.50% convertible notes | First Offering
Debt Obligations
Deferred fees expensed as interest expense					$ 1,000
4.75% Notes
Debt Obligations
Debt, Face Value		$ 110,000	$ 110,000		$ 110,000
Interest rate		4.75%		4.75%	4.75%	4.75%
Loss on extinguishment of debt			$ 3,300

XML

Debt Obligations - Junior Subordinated Notes (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
Debt Obligations
Junior subordinated notes	$ 143,695	$ 143,128
Debt, Wtd. Avg. Rate	7.59%
Junior subordinated notes
Debt Obligations
Junior subordinated notes	$ 143,700	143,100
Deferred amount due at maturity	9,100	9,600
Deferred fees expensed as interest expense	$ 1,500	$ 1,600
Debt, Wtd. Avg. Rate	8.55%	7.65%
Weighted average note rate including certain fees and costs, percentage	8.63%	7.74%

XML

Debt Obligations - Debt Covenants (Details) - USD ($)	1 Months Ended					9 Months Ended
	Oct. 31, 2023	Jul. 31, 2023	Apr. 30, 2023	Jan. 31, 2023	Oct. 31, 2022	Sep. 30, 2023
CLO 14
Overcollateralization [Abstract]
Current		119.76%	119.76%	119.76%	119.76%	119.76%
Limit						118.76%
Interest Coverage [Abstract]
Current						153.74%
Limit						120.00%
CLO 14 | Forecast
Overcollateralization [Abstract]
Current	119.76%
CLO 15
Overcollateralization [Abstract]
Current		120.85%	120.85%	120.85%	120.85%	120.85%
Limit						119.85%
Interest Coverage [Abstract]
Current						151.78%
Limit						120.00%
CLO 15 | Forecast
Overcollateralization [Abstract]
Current	120.85%
CLO 16
Overcollateralization [Abstract]
Current		121.21%	121.21%	121.21%	121.21%	121.21%
Limit						120.21%
Interest Coverage [Abstract]
Current						148.88%
Limit						120.00%
CLO 16 | Forecast
Overcollateralization [Abstract]
Current	121.21%
CLO 17
Overcollateralization [Abstract]
Current		122.51%	122.51%	122.51%	122.51%	122.51%
Limit						121.51%
Interest Coverage [Abstract]
Current						143.35%
Limit						120.00%
CLO 17 | Forecast
Overcollateralization [Abstract]
Current	122.51%
CLO 18
Overcollateralization [Abstract]
Current		124.03%	124.03%	124.03%	124.03%	124.03%
Limit						123.03%
Interest Coverage [Abstract]
Current						148.56%
Limit						120.00%
CLO 18 | Forecast
Overcollateralization [Abstract]
Current	124.03%
CLO 19
Overcollateralization [Abstract]
Current		120.30%	120.30%	120.30%	120.30%	120.30%
Limit						119.30%
Interest Coverage [Abstract]
Current						132.54%
Limit						120.00%
CLO 19 | Forecast
Overcollateralization [Abstract]
Current	120.30%
Junior subordinated notes
Interest Coverage [Abstract]
Amount payable on default of senior debt						$ 0

XML

Allowance for Loss - Sharing Obligations (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Roll forward of loss contingency accrual
Provisions for loss sharing	$ 1,679	$ 412	$ 12,528	$ (2,199)
Guarantee obligations	34,600	34,200	34,600	34,200
Allowance for loss sharing obligations	34,700		$ 34,700		$ 22,700
Loss-sharing obligations (as a percent)			0.17%		0.12%
Impact of adopting CECL	2,500		$ 11,900
Loss-Sharing Obligation
Roll forward of loss contingency accrual
Outstanding advances under the Fannie Mae DUS program	300		300		$ 800
Loss-Sharing Obligation | Fannie Mae Mortgage
Roll forward of loss contingency accrual
Beginning balance	66,681	53,053	57,168	56,064	56,064
Provisions for loss sharing	1,703	2,346	13,992	2,593
Provisions reversal for loan repayments	(24)	(1,934)	(1,464)	(4,792)
Recoveries (charge-offs), net	901	46	(435)	(354)
Ending balance	69,261	$ 53,511	69,261	$ 53,511	57,168
Maximum quantifiable liability	$ 3,790,000		$ 3,790,000		$ 3,490,000

XML

Derivative Financial Instruments - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Derivative Financial Instruments
Net loss from changes in the fair value of derivatives	$ 1,000	$ 22,900	$ 2,000	$ 20,500
Mortgage servicing rights	14,109	19,408	$ 48,769	52,287
Swaps
Derivative Financial Instruments
Derivative, maturity term			3 months
Derivative swap default credit			5 years
Swaps | Other Income | Agency Business
Derivative Financial Instruments
Realized gain on derivatives	400	3,600	$ 1,500	27,200
Unrealized gains (losses) on derivatives	$ 200	$ 3,400	$ (3,000)	$ 3,400
Swaps | Minimum
Derivative Financial Instruments
Derivative swap rate period			5 years
Swaps | Maximum
Derivative Financial Instruments
Derivative swap rate period			10 years

XML

Derivative Financial Instruments - Schedule of Non-Qualifying Derivative Financial Instruments (Details) $ in Thousands	Sep. 30, 2023 USD ($) count	Dec. 31, 2022 USD ($) count
Non-Qualifying | Agency Business
Derivative Financial Instruments
Notional Value	$ 570,656	$ 515,723
Derivative Assets	3,341	1,505
Derivative Liabilities	(8,161)	$ (4,897)
Rate lock commitments
Derivative Financial Instruments
Notional Value	$ 107,093
Rate lock commitments | Non-Qualifying | Agency Business
Derivative Financial Instruments
Count | count	4	6
Notional Value	$ 107,093	$ 91,472
Derivative Assets	962	354
Derivative Liabilities	(2,339)	$ (1,070)
Forward sale commitments
Derivative Financial Instruments
Notional Value	$ 455,363
Forward sale commitments | Non-Qualifying | Agency Business
Derivative Financial Instruments
Count | count	36	27
Notional Value	$ 455,363	$ 294,451
Derivative Assets	2,379	1,151
Derivative Liabilities	$ (5,822)	$ (3,827)
Swaps | Non-Qualifying | Agency Business
Derivative Financial Instruments
Count | count	82	1,298
Notional Value	$ 8,200	$ 129,800

XML

Fair Value - Carrying Value and Estimated Fair Value (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
Financial assets:
Loans and investments, net, Principal/Notional Amount	$ 13,122,395	$ 14,456,123
Loans and investments, net	12,892,796	14,254,674
Loans held-for-sale, net, Principal/Notional Amount	368,330	368,066
Loans held-for-sale, net	368,330	368,066
Securities, held-to-maturity, net, Principal/Notional Amount	231,577	234,255
Securities held-to-maturity, net	155,172	156,547
Derivative financial instruments, Principal/Notional Amount	130,778	111,950
Financial liabilities:
Credit and repurchase facilities, Principal/Notional Amount	3,398,451	3,856,009
Credit and repurchase facilities	3,391,441	3,841,814
Securitized debt	7,004,634	7,849,270
Senior unsecured notes	1,332,926	1,385,994
Convertible senior unsecured notes	282,428	280,356
Junior subordinated notes	143,695	143,128
Derivative financial instruments, Principal/Notional Amount	$ 431,678	273,973
Minimum
Financial liabilities:
Period of loans held for sale sold	60 days
Maximum
Financial liabilities:
Period of loans held for sale sold	180 days
Carrying Value
Financial assets:
Loans and investments, net	$ 12,892,796	14,254,674
Loans held-for-sale, net	364,320	354,070
Capitalized mortgage servicing rights, net	392,203	401,471
Securities held-to-maturity, net	155,172	156,547
Derivative financial instruments	3,341	1,505
Financial liabilities:
Credit and repurchase facilities	3,391,441	3,841,814
Securitized debt	7,004,634	7,849,270
Senior unsecured notes	1,332,926	1,385,994
Convertible senior unsecured notes	282,428	280,356
Junior subordinated notes	143,695	143,128
Derivative financial instruments	8,161	4,897
Estimated Fair Value
Financial assets:
Loans and investments, net	12,911,172	14,468,418
Loans held-for-sale, net	374,534	362,054
Capitalized mortgage servicing rights, net	538,078	530,913
Securities held-to-maturity, net	126,608	144,571
Derivative financial instruments	3,341	1,505
Financial liabilities:
Credit and repurchase facilities	3,382,933	3,828,192
Securitized debt	6,899,147	7,560,541
Senior unsecured notes	1,211,633	1,262,560
Convertible senior unsecured notes	290,019	287,834
Junior subordinated notes	105,821	103,977
Derivative financial instruments	8,161	4,897
Securitized debt
Financial liabilities:
Debt face value issued to third parties	7,029,202	7,886,066
Senior unsecured notes
Financial liabilities:
Debt face value issued to third parties	1,345,000	1,399,600
Convertible senior unsecured notes
Financial liabilities:
Debt face value issued to third parties	287,500	287,500
Junior subordinated notes
Financial liabilities:
Debt face value issued to third parties	154,336	154,336
Junior subordinated notes	$ 143,700	$ 143,100

XML

Fair Value - Measurement on Recurring and Nonrecurring Basis (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2023 USD ($) loan	Dec. 31, 2022 USD ($)
Financial assets:
Impaired loans, net	$ 280,258	$ 147,131
Financial liabilities:
Allowance for credit losses on impaired loans	$ 111,100
Number of impaired loans | loan	13
Aggregate carrying value of impaired loans before reserves	$ 280,300
Unrealized impairment losses on held-for-sale	$ 2,900
Number of impaired loans held-for-sale | loan	6
Unrealized impairment losses	$ 20,100
Carrying Value
Financial assets:
Derivative financial instruments	3,341	1,505
Financial liabilities:
Derivative financial instruments	8,161	4,897
Fair Value
Financial assets:
Derivative financial instruments	3,341	1,505
Financial liabilities:
Derivative financial instruments	8,161	$ 4,897
Recurring basis | Carrying Value
Financial assets:
Derivative financial instruments	3,341
Financial liabilities:
Derivative financial instruments	8,161
Recurring basis | Fair Value
Financial assets:
Derivative financial instruments	3,341
Financial liabilities:
Derivative financial instruments	8,161
Nonrecurring basis | Carrying Value
Financial assets:
Loans held-for-investment	169,171
Loans held-for-sale	17,169
Impaired loans, net	186,340
Nonrecurring basis | Fair Value
Financial assets:
Loans held-for-investment	169,171
Loans held-for-sale	17,169
Impaired loans, net	186,340
Level 1 | Recurring basis
Financial assets:
Derivative financial instruments	0
Financial liabilities:
Derivative financial instruments	0
Level 1 | Nonrecurring basis
Financial assets:
Loans held-for-investment	0
Loans held-for-sale	0
Impaired loans, net	0
Level 2 | Recurring basis
Financial assets:
Derivative financial instruments	2,379
Financial liabilities:
Derivative financial instruments	8,161
Level 2 | Nonrecurring basis
Financial assets:
Loans held-for-investment	0
Loans held-for-sale	17,169
Impaired loans, net	17,169
Level 3 | Recurring basis
Financial assets:
Derivative financial instruments	962
Financial liabilities:
Derivative financial instruments	0
Level 3 | Nonrecurring basis
Financial assets:
Loans held-for-investment	169,171
Loans held-for-sale	0
Impaired loans, net	$ 169,171

XML

Fair Value - Level 3 Inputs (Details) - Level 3 $ in Thousands	Sep. 30, 2023 USD ($)
Multifamily
Fair Value
Impaired loans, fair value	$ 70,246
Multifamily | Capitalization rate
Fair Value
Impaired loans, measurement input	6.53
Land
Fair Value
Impaired loans, fair value	$ 50,000
Land | Discount rate
Fair Value
Impaired loans, measurement input	21.50
Land | Revenue growth rate
Fair Value
Impaired loans, measurement input	3.00
Office
Fair Value
Impaired loans, fair value	$ 37,074
Office | Discount rate
Fair Value
Impaired loans, measurement input	7.50
Office | Capitalization rate
Fair Value
Impaired loans, measurement input	5.25
Office | Revenue growth rate
Fair Value
Impaired loans, measurement input	3.00
Retail
Fair Value
Impaired loans, fair value	$ 11,851
Retail | Discount rate
Fair Value
Impaired loans, measurement input	11.25
Retail | Capitalization rate
Fair Value
Impaired loans, measurement input	9.25
Retail | Revenue growth rate
Fair Value
Impaired loans, measurement input	3.00
Rate lock commitments
Fair Value
Derivative financial instruments	$ 962
Derivative Asset, Valuation Technique [Extensible List]	Valuation Technique, Discounted Cash Flow [Member]
Derivative Asset, Measurement Input [Extensible List]	Discount rate
Rate lock commitments | Discount rate
Fair Value
Impaired loans, measurement input	12.27

XML

Fair Value - Level 3 Derivative Instruments (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Derivative assets
Beginning balance	$ 757	$ 1,035	$ 354	$ 295
Settlements	(13,369)	(16,554)	(46,123)	(47,491)
Realized gains recorded in earnings	12,612	15,519	45,769	47,196
Unrealized gains recorded in earnings	962	1,554	962	1,554
Ending balance	$ 962	$ 1,554	$ 962	$ 1,554

XML

Fair Value - Components of fair value and other relevant information (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Jun. 30, 2022	Sep. 30, 2023
Fair Value
Fair Value of Servicing Rights		$ 5,264
Interest Rate Movement Effect		0
Unrealized Impairment Loss	$ (4,100)	(2,891)
Total Fair Value Adjustment		2,373
Rate lock commitments
Fair Value
Notional/ Principal Amount		107,093
Fair Value of Servicing Rights		962
Interest Rate Movement Effect		(2,339)
Unrealized Impairment Loss		0
Total Fair Value Adjustment		(1,377)
Forward sale commitments
Fair Value
Notional/ Principal Amount		455,363
Fair Value of Servicing Rights		0
Interest Rate Movement Effect		2,339
Unrealized Impairment Loss		0
Total Fair Value Adjustment		2,339
Loans held-for-sale, net
Fair Value
Notional/ Principal Amount		368,330
Fair Value of Servicing Rights		4,302
Interest Rate Movement Effect		0
Unrealized Impairment Loss		(2,891)
Total Fair Value Adjustment		$ 1,411

XML

Fair Value - Financial Assets and Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Financial assets:
Loans and investments, net	$ 12,892,796	$ 14,254,674
Loans held-for-sale, net	368,330	368,066
Securities held-to-maturity, net	155,172	156,547
Financial liabilities:
Credit and repurchase facilities	3,391,441	3,841,814
Securitized debt	7,004,634	7,849,270
Senior unsecured notes	1,332,926	1,385,994
Convertible senior unsecured notes	282,428	280,356
Junior subordinated notes	143,695	143,128
Level 1
Financial assets:
Loans and investments, net	0
Loans held-for-sale, net	0
Capitalized mortgage servicing rights, net	0
Securities held-to-maturity, net	0
Financial liabilities:
Credit and repurchase facilities	0
Securitized debt	0
Senior unsecured notes	1,211,633
Convertible senior unsecured notes	0
Junior subordinated notes	0
Level 2
Financial assets:
Loans and investments, net	0
Loans held-for-sale, net	370,232
Capitalized mortgage servicing rights, net	0
Securities held-to-maturity, net	0
Financial liabilities:
Credit and repurchase facilities	354,586
Securitized debt	0
Senior unsecured notes	0
Convertible senior unsecured notes	290,019
Junior subordinated notes	0
Level 3
Financial assets:
Loans and investments, net	12,911,172
Loans held-for-sale, net	4,302
Capitalized mortgage servicing rights, net	538,078
Securities held-to-maturity, net	126,608
Financial liabilities:
Credit and repurchase facilities	3,028,347
Securitized debt	6,899,147
Senior unsecured notes	0
Convertible senior unsecured notes	0
Junior subordinated notes	105,821
Carrying Value
Financial assets:
Loans and investments, net	12,892,796	14,254,674
Loans held-for-sale, net	364,320	354,070
Capitalized mortgage servicing rights, net	392,203
Securities held-to-maturity, net	155,172	156,547
Financial liabilities:
Credit and repurchase facilities	3,391,441	3,841,814
Securitized debt	7,004,634	7,849,270
Senior unsecured notes	1,332,926	1,385,994
Convertible senior unsecured notes	282,428	280,356
Junior subordinated notes	143,695	143,128
Fair Value
Financial assets:
Loans and investments, net	12,911,172	14,468,418
Loans held-for-sale, net	374,534	362,054
Capitalized mortgage servicing rights, net	538,078
Securities held-to-maturity, net	126,608	144,571
Financial liabilities:
Credit and repurchase facilities	3,382,933	3,828,192
Securitized debt	6,899,147	7,560,541
Senior unsecured notes	1,211,633	1,262,560
Convertible senior unsecured notes	290,019	287,834
Junior subordinated notes	$ 105,821	$ 103,977

XML

Commitments and Contingencies - Contractual Commitments (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Agency Business Commitments
Cash collateral per securitization	$ 5,000		$ 5,000
Outstanding letters of credit	5,000		5,000
Debt Obligations
2023 (three months ending December 31, 2023)	858,768		858,768
2024	2,004,350		2,004,350
2025	3,378,563		3,378,563
2026	4,523,241		4,523,241
2027	1,115,231		1,115,231
2028	180,000		180,000
Thereafter	154,336		154,336
Total	12,214,489		12,214,489
Minimum Annual Operating Lease Payments
2023 (three months ending December 31, 2023)	2,300		2,300
2024	10,188		10,188
2025	10,555		10,555
2026	10,627		10,627
2027	9,225		9,225
2028	8,624		8,624
Thereafter	27,755		27,755
Total	79,274		79,274
Total
2023 (three months ending December 31, 2023)	861,068		861,068
2024	2,014,538		2,014,538
2025	3,389,118		3,389,118
2026	4,533,868		4,533,868
2027	1,124,456		1,124,456
2028	188,624		188,624
Thereafter	182,091		182,091
Total	12,293,763		12,293,763
Operating lease expense	2,800	$ 2,400	8,000	$ 7,200
Fannie Mae Mortgage
Agency Business Commitments
Minimum liquid assets to be maintained to meet operational liquidity requirements	19,800		$ 19,800
Period of funding for collateral requirement			48 months
Letter of credit required	72,600		$ 72,600
Letter of credit assigned	64,000		64,000
Reserve required to fund additional restricted liquidity over the next 48 months	$ 37,300		$ 37,300
Period of additional funding for collateral requirement			48 months
Forward Contracts
Agency Business Commitments
Period of contractual commitment			60 days

XML

Commitments and Contingencies - Litigation (Details) $ in Millions	1 Months Ended			3 Months Ended		9 Months Ended
	Dec. 31, 2022 USD ($)	Jun. 30, 2013 lawsuit defendant	Jun. 30, 2011 defendant lawsuit	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)
Commitments and Contingencies
Operating lease expense | $				$ 2.8	$ 2.4	$ 8.0	$ 7.2
Litigation settlement amount | $	$ 38.0
Land
Commitments and Contingencies
Outstanding unfunded commitments | $	1,150.0			$ 1,080.0		$ 1,080.0
Lawsuits filed by Extended Stay Litigation Trust (the Trust)
Commitments and Contingencies
Number of lawsuits or complaints filed | lawsuit			3
Number of defendants			73
Number of defendants who are corporate and partnership entities			55
Number of defendants named in a legal action who are individuals			18
Lawsuits filed by Extended Stay Litigation Trust (the Trust) | Maximum
Commitments and Contingencies
Litigation settlement, expense | $	$ 7.4
Lawsuits filed by Extended Stay Litigation Trust (the Trust) | Motion to amend the lawsuits
Commitments and Contingencies
Number of defendants who are corporate and partnership entities		16
Number of defendants named in a legal action who are individuals		10
Number of lawsuits consolidated | lawsuit		1
Number of defendants removed due to consolidation of lawsuits		47
Number of defendants related to the entity		0
Number of defendants remaining due to consolidation of lawsuits		26
Number of lawsuits before amendment | lawsuit		100
Number of lawsuits after amendment | lawsuit		17

XML

Variable Interest Entity (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2023 USD ($) entity	Dec. 31, 2022 USD ($)	Sep. 30, 2022 USD ($)	Dec. 31, 2021 USD ($)
Assets:
Restricted cash	$ 419,158	$ 713,808	$ 922,531	$ 486,690
Loans and investments, net	12,892,796	14,254,674
Other assets	416,741	371,440
Total assets	15,902,689	17,038,985
Liabilities:
Securitized debt	7,004,634	7,849,270
Other liabilities	320,973	335,789
Total liabilities	12,662,188	13,967,106
CLOs and Debt Fund
Assets:
Restricted cash	408,569	710,775
Loans and investments, net	7,968,741	8,900,104
Other assets	311,988	174,382
Total assets	8,689,298	9,785,261
Liabilities:
Securitized debt	7,004,634	7,849,270
Other liabilities	23,259	26,754
Total liabilities	7,027,893	$ 7,876,024
Unconsolidated VIEs
Assets:
Total assets	$ 612,595
Liabilities:
Number of VIEs where the reporting entity is not VIE's primary beneficiary and VIEs have variable interest | entity	27
Carrying amount of loans and investments before reserves related to VIEs	$ 172,900
Loan loss reserves related to VIEs	85,800
Exposure to real estate debt	3,860,000
Unconsolidated VIEs | Loans
Assets:
Total assets	433,532
Unconsolidated VIEs | APL certificates
Assets:
Total assets	129,887
Unconsolidated VIEs | B Piece bonds
Assets:
Total assets	31,228
Unconsolidated VIEs | Equity investments
Assets:
Total assets	17,771
Unconsolidated VIEs | Agency interest only strips
Assets:
Total assets	$ 177

XML

Equity - Narrative (Details) $ / shares in Units, $ in Thousands						3 Months Ended			9 Months Ended
	Oct. 25, 2023 $ / shares	Sep. 30, 2023 USD ($) Vote $ / shares shares	Jul. 26, 2023 $ / shares	May 03, 2023 $ / shares	Feb. 15, 2023 $ / shares	Sep. 30, 2023 Vote $ / shares shares	Mar. 31, 2023 USD ($) shares	Sep. 30, 2022 $ / shares shares	Sep. 30, 2023 USD ($) Vote $ / shares shares	Sep. 30, 2022 USD ($) $ / shares shares	Dec. 31, 2022 $ / shares
Common stock
Common stock, par value (in dollars per share) | $ / shares		$ 0.01				$ 0.01			$ 0.01		$ 0.01
Proceeds from issuance of shares under public offering | $									$ 193,660	$ 312,766
Preferred stock, par value (in dollars per share) | $ / shares		0.01				0.01			$ 0.01		$ 0.01
Dividends declared per common share (in dollars per share) | $ / shares						$ 0.43		$ 0.39	$ 1.25	$ 1.14
Subsequent event
Common stock
Dividends declared per common share (in dollars per share) | $ / shares	$ 0.43
Restricted common stock | Chief executive officer
Common stock
Restricted stock vested during period (in shares)						313,152
Restricted common stock | Chief executive officer | 2020 Plan
Common stock
Grants during the period (in shares)									247,275
Total grant date fair value | $									$ 2,900
Restricted common stock | Employees
Common stock
Shares withheld for taxes (in shares)									220,315
Restricted common stock | Employees | 2020 Plan
Common stock
Grants during the period (in shares)									939,325
Total grant date fair value | $									$ 11,200
Restricted common stock | Employees | Vested on grant date | 2020 Plan
Common stock
Grants during the period (in shares)									297,182
Total grant date fair value | $									$ 3,600
Restricted common stock | Employees | First anniversaries | 2020 Plan
Common stock
Grants during the period (in shares)									276,785
Total grant date fair value | $									$ 3,300
Restricted common stock | Employees | Second anniversaries | 2020 Plan
Common stock
Grants during the period (in shares)									252,510
Total grant date fair value | $									$ 3,000
Restricted common stock | Employees | Third anniversaries | 2020 Plan
Common stock
Grants during the period (in shares)									78,126
Total grant date fair value | $									$ 900
Restricted common stock | Employees | Fourth anniversaries | 2020 Plan
Common stock
Grants during the period (in shares)									34,722
Total grant date fair value | $									$ 400
RSUs | Director | 2020 Plan
Common stock
Grants during the period (in shares)									40,796
Total grant date fair value | $									$ 500
Performance-based restricted stock | Chief executive officer
Common stock
Restricted stock vested during period (in shares)							352,427
Common stock | Chief executive officer
Common stock
Restricted stock vested during period (in shares)						153,287	172,513
Common stock
Common stock
Number of common stock sold (in shares)						5,576,496		3,170,688	13,113,296	19,625,788
Dividends declared per common share (in dollars per share) | $ / shares			$ 0.43	$ 0.42	$ 0.40
Operating Partnership Units
Common stock
Conversion ratio for operating partnership units to common stock shares									1
Operating Partnership Units | Special voting preferred shares
Common stock
Number of preferred stock shares paired with each OP units (in shares)									1
Preferred stock, par value (in dollars per share) | $ / shares		$ 0.01				$ 0.01			$ 0.01
Number of vote per share of special voting preferred shares (in shares) | Vote		1				1			1
OP units outstanding (in shares)		16,293,589				16,293,589			16,293,589
Voting power of outstanding stock, percentage									8.00%
Share repurchase program
Common stock
Authorized amount to repurchase | $							$ 50,000
Number of shares repurchased (in shares)		3,545,604
Value of shares repurchased | $		$ 37,400
Average cost per share (in dollars per share) | $ / shares		$ 10.56
Public offering | Common stock
Common stock
Number of common stock sold (in shares)									13,113,296
Proceeds from issuance of shares under public offering | $									$ 193,600
At-The-Market | Common stock
Common stock
Common stock, par value (in dollars per share) | $ / shares		$ 14.77				$ 14.77			$ 14.77

XML

Equity - Schedule of Dividends Payable (Details) - $ / shares								3 Months Ended		9 Months Ended
	Sep. 29, 2023	Jul. 26, 2023	Jun. 30, 2023	May 03, 2023	Mar. 31, 2023	Feb. 15, 2023	Jan. 03, 2023	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items]
Common Stock, Dividend (in dollars per share)								$ 0.43	$ 0.39	$ 1.25	$ 1.14
Common stock
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items]
Common Stock, Dividend (in dollars per share)		$ 0.43		$ 0.42		$ 0.40
Preferred Stock | Series D
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items]
Cash dividend declared on redeemable preferred stock (in dollars per share)	$ 0.3984375		$ 0.3984375		$ 0.3984375		$ 0.3984375
Preferred Stock | Series E
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items]
Cash dividend declared on redeemable preferred stock (in dollars per share)	0.390625		0.390625		0.390625		0.390625
Preferred Stock | Series F
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items]
Cash dividend declared on redeemable preferred stock (in dollars per share)	$ 0.390625		$ 0.390625		$ 0.390625		$ 0.390625

XML

Equity - Earnings Per Share ("EPS") (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Basic
Net income attributable to common stockholders	$ 77,924	$ 62,710	$ 238,407	$ 196,678
Net income attributable to common stockholders and noncontrolling interest	$ 77,924	$ 62,710	$ 238,407	$ 196,678
Weighted average shares outstanding (in shares)	187,023,395	170,227,553	183,340,149	162,292,235
Weighted average shares outstanding (in shares)	187,023,395	170,227,553	183,340,149	162,292,235
Net income per common share (in dollars per share)	$ 0.42	$ 0.37	$ 1.30	$ 1.21
Diluted
Net income attributable to common stockholders	$ 77,924	$ 62,710	$ 238,407	$ 196,678
Net income attributable to noncontrolling interest	6,789	6,002	21,200	19,811
Interest expense on convertible notes	6,081	5,797	18,244	13,786
Net income attributable to common stockholders and noncontrolling interest	$ 90,794	$ 74,509	$ 277,851	$ 230,275
Weighted average shares outstanding (in shares)	187,023,395	170,227,553	183,340,149	162,292,235
Dilutive effect of OP Units (in shares)	16,293,589	16,293,589	16,293,589	16,308,361
Dilutive effect of convertible notes (in shares)	17,312,382	18,815,399	17,271,419	16,370,528
Dilutive effect of restricted stock units (in shares)	699,452	528,475	552,242	558,216
Weighted average shares outstanding ( in shares)	221,328,818	205,865,016	217,457,399	195,529,340
Diluted earnings per common share (in dollars per share)	$ 0.41	$ 0.36	$ 1.28	$ 1.18
Mr. Ivan Kaufman | Performance-based restricted stock
Diluted
Vesting period (in years)			4 years

XML

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Income Taxes
Provision (benefit) for income taxes	$ 5,854	$ (374)	$ 19,436	$ 13,166
Current tax provision	8,300	5,000	26,000	21,000
Deferred tax benefit	$ 2,400	$ 5,400	$ 6,630	$ 7,833
Minimum
Income Taxes
Federal income tax rate			90.00%

XML

Agreements and Transactions with Related Parties - Shared Services Agreement (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Related Party | Other Related Party Transactions
Agreements and Transactions with Related Parties
Costs for services to related party	$ 0.9	$ 0.9	$ 2.3	$ 2.5

XML

Agreements and Transactions with Related Parties - Other Related Party (Details) $ in Thousands		1 Months Ended					3 Months Ended			9 Months Ended		12 Months Ended
	Jul. 01, 2023	May 30, 2023 USD ($)	Apr. 30, 2023 USD ($)	Jul. 31, 2022 USD ($)	Apr. 30, 2022 USD ($)	Feb. 28, 2022 USD ($)	Sep. 30, 2023 USD ($) entity shares	Jun. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) entity shares	Sep. 30, 2022 USD ($)	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($) property	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($) loan property	Dec. 31, 2017 USD ($) loan property	Dec. 31, 2016 USD ($) property	Dec. 31, 2015 USD ($)	May 31, 2023 USD ($) officer	Dec. 31, 2022 USD ($)	Jun. 30, 2022 USD ($)
Agreements and Transactions with Related Parties
Interest income							$ 336,474		$ 259,778	$ 1,000,159	$ 627,804
Investment made										1,061,865	5,418,113
Loans and investments, allowance for credit losses							184,069	$ 169,054	122,296	184,069	122,296	$ 113,241								$ 132,559	$ 121,331
Servicing revenue							51,363		37,526	$ 144,296	109,045
Indirect ownership percentage										9.20%
Arbor Residential Investor LLC
Agreements and Transactions with Related Parties
Indirect ownership percentage										12.30%
Lexford Portfolio
Agreements and Transactions with Related Parties
Distribution received									5,000	$ 7,200	11,000
AMAC Holdings III LLC
Agreements and Transactions with Related Parties
Gain (loss) on investments							(700)		(700)	(1,600)	(1,800)
Distribution received									200	1,100	400
Other Related Party Transactions | Arbor Residential Investor LLC
Agreements and Transactions with Related Parties
Distribution from investment classified as return capital							7,500		7,300	15,000	22,300
Multifamily
Agreements and Transactions with Related Parties
Loans and investments, allowance for credit losses							89,179	74,295	27,283	89,179	27,283	18,707								37,961	27,958
Single-Family Rental
Agreements and Transactions with Related Parties
Loans and investments, allowance for credit losses							1,239	$ 1,077	2,051	1,239	2,051	320								781	$ 725
Maturity date of March 2025 | SOFR | Other Related Party Transactions
Agreements and Transactions with Related Parties
Base spread, percentage				5.50%
Bridge loans
Agreements and Transactions with Related Parties
Variable rate, spread								3.40%
Bridge loans | Matures In May 2025 | SOFR | Other Related Party Transactions
Agreements and Transactions with Related Parties
Base spread, percentage			5.25%
SOFR floor, percentage			1.00%
Bridge loan, six multifamily properties | Other Related Party Transactions
Agreements and Transactions with Related Parties
UPB converted to a mezzanine loan														$ 2,000
Related Party
Agreements and Transactions with Related Parties
Due from related party							211,655			211,655										77,419
Due to related party							2,170			2,170										12,350
Amount invested												$ 4,200
Related Party | LLC
Agreements and Transactions with Related Parties
Ownership interest, percentage												49.30%
Related Party | Other Related Party Transactions
Agreements and Transactions with Related Parties
Due from related party							211,700			211,700										77,400
Due to related party							2,200			2,200										12,400
Related Party | Other Related Party Transactions | AMAC III
Agreements and Transactions with Related Parties
Interest income							800		500	2,300	1,200
Amount invested							25,200			$ 25,200				$ 30,000
Ownership interest, percentage														18.00%
Related Party | Other Related Party Transactions | Lexford Portfolio
Agreements and Transactions with Related Parties
Management fee, percentage of gross revenues of underlying properties										4.75%
Related Party | Commercial Mortgage Backed Security
Agreements and Transactions with Related Parties
Loans assumed												$ 26,000
Related Party | Residential mortgage banking business | Other Related Party Transactions | ACM
Agreements and Transactions with Related Parties
Noncontrolling interest in equity method investment acquired (as a percent)																		50.00%
Related Party | Residential mortgage banking business | Other Related Party Transactions | Noncontrolling Interest
Agreements and Transactions with Related Parties
Gain (loss) on investments							$ (1,300)		300	$ 1,300	6,400
Indirect ownership percentage										12.30%
Related Party | Residential mortgage banking business | Other Related Party Transactions | ACM
Agreements and Transactions with Related Parties
Acquisition purchase price																		$ 9,600
Related Party | ACM Acquisition | Other Related Party Transactions | ACM
Agreements and Transactions with Related Parties
Number of shares held by related party (in shares) | shares							2,535,870			2,535,870
OP units hold as part of acquisition (in shares) | shares										10,615,085
Aggregate percentage of voting power held by related party							6.40%			6.40%
Related Party | Multifamily | Fannie Mae Mortgage | Other Related Party Transactions
Agreements and Transactions with Related Parties
Principal amount																$ 46,900
Percentage of ownership interest of related party in the entity																17.60%
Percentage of maximum loss-sharing obligation unpaid principal balance																5.00%
Servicing revenue							$ 100		100	$ 100	100
Related Party | Retail property
Agreements and Transactions with Related Parties
Property purchased												32,500
Related Party | Maturity Date April 2030 | Multifamily | Other Related Party Transactions
Agreements and Transactions with Related Parties
Number of properties owned | property													2
Related Party | Maturity date of August 2023 | One multifamily property | Other Related Party Transactions
Agreements and Transactions with Related Parties
Principal amount													$ 35,400
Related Party | Maturity date of March 2030 | Private Label | Other Related Party Transactions | Lexford Portfolio
Agreements and Transactions with Related Parties
Principal amount													34,600
Related Party | Preferred equity investments
Agreements and Transactions with Related Parties
Loans and investments, allowance for credit losses							8,000			8,000										$ 8,000
Related Party | Preferred equity investments | Single-Family Rental | Other Related Party Transactions
Agreements and Transactions with Related Parties
Investment made													$ 4,600
Related Party | Preferred equity investments | Matures in April 2023 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Fixed rate of interest													12.00%
Related Party | Preferred equity investments | Maturity Date April 2030 | Multifamily | Other Related Party Transactions
Agreements and Transactions with Related Parties
Equity investment													$ 3,400
Related Party | Preferred equity investments | Maturity Date June 2027
Agreements and Transactions with Related Parties
Equity investment							10,000			10,000
Related Party | Mezzanine Loans | Maturity Date April 2030 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Fixed rate of interest													9.00%
Related Party | Bridge loans | Other Related Party Transactions
Agreements and Transactions with Related Parties
Equity participation interest (as a percentage)													18.90%
Related Party | Bridge loans | Single-Family Rental | Other Related Party Transactions
Agreements and Transactions with Related Parties
Loan committed										24,500
Investment made													$ 3,500
Loan committed upsized			$ 38,400
Related Party | Bridge loans | Maturity Date December 2025
Agreements and Transactions with Related Parties
Interest income							100			200
Related Party | Bridge loans | Maturity Date December 2025 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Principal amount																			$ 56,900
Loan committed		$ 3,800
Number of officers making minority equity investments | officer																			2
Equity investment																			$ 500
Equity participation interest (as a percentage)																			4.00%
Related Party | Bridge loans | Maturity Date December 2025 | SOFR | Other Related Party Transactions
Agreements and Transactions with Related Parties
Base spread, percentage																			5.50%
SOFR floor, percentage		3.25%
Related Party | Bridge loans | Maturity date of March 2025
Agreements and Transactions with Related Parties
Interest income							100			100
Related Party | Bridge loans | Maturity date of March 2025 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Principal amount				$ 46,200
Loan committed										3,500
Related Party | Bridge loans | Maturity date of March 2025 | SOFR | Other Related Party Transactions
Agreements and Transactions with Related Parties
Equity participation interest (as a percentage)				70.00%
Related Party | Bridge loans | Maturity date of May 2025 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Principal amount					$ 67,100
Interest income							100			200
Related Party | Bridge loans | Maturity date of May 2025 | SOFR | Other Related Party Transactions
Agreements and Transactions with Related Parties
Base spread, percentage					4.63%
SOFR floor, percentage					0.25%
Equity participation interest (as a percentage)					2.25%
Related Party | Bridge loans | Maturity date of May 2025 | Single-Family Rental | Other Related Party Transactions
Agreements and Transactions with Related Parties
Loan committed													30,500
Related Party | Bridge loans | Maturity date of May 2025 | Maximum | Other Related Party Transactions
Agreements and Transactions with Related Parties
Interest income							100		100
Related Party | Bridge loans | Maturity date of March 2025, Committed February 2022 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Principal amount						$ 39,400
Loan committed										3,100
Interest income							100		100	100	100
Related Party | Bridge loans | Maturity date of March 2025, Committed February 2022 | SOFR | Other Related Party Transactions
Agreements and Transactions with Related Parties
Base spread, percentage	4.00%
SOFR floor, percentage	0.25%
Related Party | Bridge loans | Maturity date of March 2025, Committed February 2022 | London Interbank Offered Rate (LIBOR) 1 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Base spread, percentage						4.00%
SOFR floor, percentage						0.25%
Equity participation interest (as a percentage)						2.25%
Related Party | Bridge loans | Maturity date of March 2024 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Loan committed												$ 63,400
Interest income							1,500		1,000	4,300	2,500
Related Party | Bridge loans | Maturity date of March 2024 | SOFR | Other Related Party Transactions
Agreements and Transactions with Related Parties
Base spread, percentage	3.75%
SOFR floor, percentage	0.25%
Related Party | Bridge loans | Maturity date of March 2024 | London Interbank Offered Rate (LIBOR) 1 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Base spread, percentage												3.75%
SOFR floor, percentage												0.25%
Related Party | Bridge loans | Maturity Date December 2023 | Single-Family Rental | Other Related Party Transactions
Agreements and Transactions with Related Parties
Loan committed													$ 32,500
Related Party | Bridge loans | Matures in May 2023 | London Interbank Offered Rate (LIBOR) 1 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Base spread, percentage													5.50%
SOFR floor, percentage													0.75%
Amount invested							34,200			34,200
Related Party | Bridge loans | Matures in April 2023 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Interest income							1,000		500	2,500	1,000
Related Party | Bridge loans | Maturity Date July 2023
Agreements and Transactions with Related Parties
Principal amount							35,000			35,000
Related Party | Bridge loans | Maturity date of August 2023 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Interest income							600		400	1,600	1,000
Percentage of ownership interest of related party in the entity															75.00%
Related Party | Bridge loans | Maturity Date Of June 2021 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Principal amount															$ 280,500
Number of bridge loans originated | loan															12
Number of multifamily properties renovated | property															72
Related Party | Bridge loans | Maturity Date Of June 2021 | Other Related Party Transactions | Lexford Portfolio
Agreements and Transactions with Related Parties
Base spread, percentage															4.00%
Distribution received									5,000	7,200	11,000
Paydowns of principal made by borrower														$ 250,000
Unsecured financing provided by an unsecured lender to certain parent entities of the property owners							50,000			50,000
Related Party | Bridge loan, one multifamily property | Maturity date of August 2023 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Principal amount															$ 21,700
Related Party | Bridge loan, one multifamily property | Maturity date of August 2023 | SOFR | Other Related Party Transactions
Agreements and Transactions with Related Parties
Variable rate, spread	3.50%
Related Party | Bridge loan, one multifamily property | Maturity date of August 2023 | London Interbank Offered Rate (LIBOR) 1 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Variable rate, spread													3.50%
Related Party | Bridge loan, several multifamily properties | Maturity date of August 2023 | SOFR | Other Related Party Transactions
Agreements and Transactions with Related Parties
Base spread, percentage	4.75%
SOFR floor, percentage	0.25%
Related Party | Bridge loan, several multifamily properties | Maturity date of August 2023 | London Interbank Offered Rate (LIBOR) 1 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Base spread, percentage															4.75%
SOFR floor, percentage															0.25%
Related Party | Bridge loan, two multifamily properties | Maturity Date April 2030 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Principal amount													$ 14,800
Interest income							100		100	200	200
Percentage of ownership interest of related party in the entity													50.00%
Related Party | Bridge loan, two multifamily properties | Maturity date of October 2022 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Principal amount																$ 28,000
Base spread, percentage																1.80%
Interest income											800
Percentage of ownership interest of related party in the entity																45.00%
Number of properties owned | property																2
Number of bridge loans originated | loan																2
Refinanced loan amount																$ 31,100
Related Party | Bridge loan, two multifamily properties | Maturity date of October 2022 | London Interbank Offered Rate (LIBOR) 1 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Base spread, percentage																4.00%
Related Party | Bridge loan, two multifamily properties | Maturity date of October 2022 | Minimum | Other Related Party Transactions
Agreements and Transactions with Related Parties
SOFR floor, percentage																1.24%
Related Party | Bridge loan, two multifamily properties | Maturity date of October 2022 | Maximum | Other Related Party Transactions
Agreements and Transactions with Related Parties
SOFR floor, percentage																1.54%
Related Party | Bridge loan, two multifamily properties | Maturity date of 2020 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Base spread, percentage																5.25%
Related Party | AMAC III | Mezzanine Loans | Other Related Party Transactions
Agreements and Transactions with Related Parties
Principal amount														7,000
Related Party | AMAC III | Bridge loan, one multifamily property | Other Related Party Transactions
Agreements and Transactions with Related Parties
Principal amount														$ 34,000
Related Party | Lexford Portfolio | Maturity date of March 2030 | Private Label | Other Related Party Transactions
Agreements and Transactions with Related Parties
Fixed rate of interest													3.30%
Related Party | Lexford Portfolio | Bridge loans | Maturity date December 2029 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Maximum exposure under guaranty							$ 600,000			600,000
Chief executive officer
Agreements and Transactions with Related Parties
Reimbursement for flights chartered by the company's executives										$ 600	1,000
Chief executive officer | Other Related Party Transactions
Agreements and Transactions with Related Parties
Percentage of our former manager's outstanding membership interest of related party in another related party							35.00%			35.00%
Chief executive officer | Minimum | Other Related Party Transactions
Agreements and Transactions with Related Parties
Ownership percentage limit of our common stock under company charter							5.00%			5.00%
Chief executive officer | Mezzanine Loans | Maturity date of January 2024 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Fixed rate of interest														10.00%
Chief executive officer | Bridge loan, six multifamily properties | Maturity date of 2019 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Principal amount																	$ 48,000
Base spread, percentage														4.50%
Number of properties owned | property																	6
Proceeds from repayment in full														$ 10,900		$ 6,800
Number of bridge loans paid off | loan															4	1
Proceeds from repayment of debt															$ 28,300
Remaining bridge loan from repayment														$ 12,900
Chief executive officer | Bridge loan, six multifamily properties | Maturity date of 2019 | London Interbank Offered Rate (LIBOR) 1 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Base spread, percentage														0.25%
Chief executive officer | Bridge loan, six multifamily properties | Maturity date of 2019 | Minimum | Other Related Party Transactions
Agreements and Transactions with Related Parties
Percentage of ownership interest of related party in the entity																	10.50%
Chief executive officer | Bridge loan, six multifamily properties | Maturity date of 2019 | Maximum | Other Related Party Transactions
Agreements and Transactions with Related Parties
Percentage of ownership interest of related party in the entity																	12.00%
Chief executive officer | Bridge loan, six multifamily properties | Maturity date of January 2024 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Interest income							$ 100		100	$ 100	100
Immediate Family Member of Management or Principal Owner | LLC
Agreements and Transactions with Related Parties
Percentage of ownership interest of related party in the entity												10.00%
Immediate Family Member of Management or Principal Owner | Maturity date of March 2025 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Percentage of ownership interest of related party in the entity				10.00%
Immediate Family Member of Management or Principal Owner | Maturity Date December 2023 | Preferred equity interest financing agreement | Other Related Party Transactions
Agreements and Transactions with Related Parties
Interest income							$ 800			$ 2,000	800
Immediate Family Member of Management or Principal Owner | Preferred equity investments | Maturity Date December 2023 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Fixed rate of interest													12.00%
Immediate Family Member of Management or Principal Owner | Bridge loans | Other Related Party Transactions
Agreements and Transactions with Related Parties
Equity participation interest (as a percentage)													21.80%
Immediate Family Member of Management or Principal Owner | Bridge loans | Maturity Date December 2023 | Other Related Party Transactions
Agreements and Transactions with Related Parties
Base spread, percentage	5.50%												5.50%
Interest income									300
Immediate Family Member of Management or Principal Owner | Bridge loans | Maturity Date December 2023 | SOFR | Other Related Party Transactions
Agreements and Transactions with Related Parties
SOFR floor, percentage	0.75%
Immediate Family Member of Management or Principal Owner | Bridge loans | Maturity Date December 2023 | London Interbank Offered Rate (LIBOR) 1 | Other Related Party Transactions
Agreements and Transactions with Related Parties
SOFR floor, percentage													0.75%
Director | Other Related Party Transactions
Agreements and Transactions with Related Parties
Number of Kaufman Entities | entity							2			2
Director | Fannie Mae Mortgage | Other Related Party Transactions
Agreements and Transactions with Related Parties
Percentage of maximum loss-sharing obligation unpaid principal balance																20.00%
Servicing revenue							$ 100		$ 100	$ 100	$ 100
Loan purchased a multifamily apartment complex which assumed																$ 8,300
Percentage of ownership after transaction										3.60%
Percentage of loan assumption fee																1.00%
Director | Ginkgo Investment Company LLC | Other Related Party Transactions
Agreements and Transactions with Related Parties
Percentage of managing member																33.00%

XML

Segment Information - Statements of Income (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023 USD ($) segment	Sep. 30, 2022 USD ($) segment	Sep. 30, 2023 USD ($) segment	Sep. 30, 2022 USD ($) segment
Segment Information
Interest income	$ 336,474	$ 259,778	$ 1,000,159	$ 627,804
Interest expense	229,180	160,452	675,749	350,079
Net interest income	107,294	99,326	324,410	277,725
Other revenue:
Gain on sales, including fee-based services, net	18,619	14,360	55,795	32,526
Mortgage servicing rights	14,109	19,408	48,769	52,287
Servicing revenue	51,363	37,526	144,296	109,045
Amortization of MSRs	(15,900)	(14,782)	(46,920)	(44,532)
Property operating income	1,450	445	4,261	1,031
Gain (loss) on derivative instruments, net	(421)	(15,909)	(3,582)	10,083
Other income (loss), net	173	(6,014)	5,099	(16,061)
Total other revenue	69,393	35,034	207,718	144,379
Other expenses:
Employee compensation and benefits	39,810	38,811	123,518	119,736
Selling and administrative	12,367	13,225	38,574	40,960
Property operating expenses	1,479	366	4,227	1,443
Depreciation and amortization	2,286	2,078	7,297	6,092
Provision for loss sharing (net of recoveries)	1,679	412	12,528	(2,199)
Provision for credit losses (net of recoveries)	18,652	2,274	55,047	9,700
Total other expenses	76,273	57,166	241,191	175,732
Income before extinguishment of debt, income from equity affiliates and income taxes	100,414	77,194	290,937	246,372
Loss on extinguishment of debt	(314)	(3,262)	(1,561)	(4,612)
Income from equity affiliates	809	4,748	20,694	18,507
(Provision for) benefit from income taxes	(5,854)	374	(19,436)	(13,166)
Net income	95,055	79,054	290,634	247,101
Preferred stock dividends	10,342	10,342	31,027	30,612
Net income attributable to noncontrolling interest	6,789	6,002	21,200	19,811
Net income attributable to common stockholders	$ 77,924	$ 62,710	$ 238,407	$ 196,678
Reporting segments | segment	2	2	2	2
Operating segments | Structured Business
Segment Information
Interest income	$ 322,819	$ 249,539	$ 962,301	$ 597,847
Interest expense	222,996	157,325	658,856	338,692
Net interest income	99,823	92,214	303,445	259,155
Other revenue:
Gain on sales, including fee-based services, net	0	0	0	0
Mortgage servicing rights	0	0	0	0
Servicing revenue	0	0	0	0
Amortization of MSRs	0	0	0	0
Property operating income	1,450	445	4,261	1,031
Gain (loss) on derivative instruments, net	0	0	0	0
Other income (loss), net	751	1,763	3,420	(4,370)
Total other revenue	2,201	2,208	7,681	(3,339)
Other expenses:
Employee compensation and benefits	12,912	13,342	41,991	42,694
Selling and administrative	5,291	5,961	17,835	19,799
Property operating expenses	1,479	366	4,227	1,443
Depreciation and amortization	1,114	906	3,779	2,574
Provision for loss sharing (net of recoveries)	0	0	0	0
Provision for credit losses (net of recoveries)	17,243	2,206	52,257	9,363
Total other expenses	38,039	22,781	120,089	75,873
Income before extinguishment of debt, income from equity affiliates and income taxes	63,985	71,641	191,037	179,943
Loss on extinguishment of debt	(314)	(3,262)	(1,561)	(4,612)
Income from equity affiliates	809	4,748	20,694	18,507
(Provision for) benefit from income taxes	1,078	319	307	(1,368)
Net income	65,558	73,446	210,477	192,470
Preferred stock dividends	10,342	10,342	31,027	30,612
Net income attributable to noncontrolling interest	0	0	0	0
Net income attributable to common stockholders	55,216	63,104	179,450	161,858
Operating segments | Agency Business
Segment Information
Interest income	13,655	10,239	37,858	29,957
Interest expense	6,184	3,127	16,893	11,387
Net interest income	7,471	7,112	20,965	18,570
Other revenue:
Gain on sales, including fee-based services, net	18,619	14,360	55,795	32,526
Mortgage servicing rights	14,109	19,408	48,769	52,287
Servicing revenue	51,363	37,526	144,296	109,045
Amortization of MSRs	(15,900)	(14,782)	(46,920)	(44,532)
Property operating income	0	0	0	0
Gain (loss) on derivative instruments, net	(421)	(15,909)	(3,582)	10,083
Other income (loss), net	(578)	(7,777)	1,679	(11,691)
Total other revenue	67,192	32,826	200,037	147,718
Other expenses:
Employee compensation and benefits	26,898	25,469	81,527	77,042
Selling and administrative	7,076	7,264	20,739	21,161
Property operating expenses	0	0	0	0
Depreciation and amortization	1,172	1,172	3,518	3,518
Provision for loss sharing (net of recoveries)	1,679	412	12,528	(2,199)
Provision for credit losses (net of recoveries)	1,409	68	2,790	337
Total other expenses	38,234	34,385	121,102	99,859
Income before extinguishment of debt, income from equity affiliates and income taxes	36,429	5,553	99,900	66,429
Loss on extinguishment of debt	0	0	0	0
Income from equity affiliates	0	0	0	0
(Provision for) benefit from income taxes	(6,932)	55	(19,743)	(11,798)
Net income	29,497	5,608	80,157	54,631
Preferred stock dividends	0	0	0	0
Net income attributable to noncontrolling interest	0	0	0	0
Net income attributable to common stockholders	29,497	5,608	80,157	54,631
Other/Eliminations
Other expenses:
Net income attributable to noncontrolling interest	6,789	6,002	21,200	19,811
Net income attributable to common stockholders	$ (6,789)	$ (6,002)	$ (21,200)	$ (19,811)

XML

Segment Information - Balance Sheet (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022	Sep. 30, 2022	Dec. 31, 2021
Assets:
Cash and cash equivalents	$ 895,298	$ 534,357	$ 389,651	$ 404,580
Restricted cash	419,158	713,808	$ 922,531	$ 486,690
Loans and investments, net	12,892,796	14,254,674
Loans held-for-sale, net	364,320	354,070
Capitalized mortgage servicing rights, net	392,203	401,471
Securities held-to-maturity, net	155,172	156,547
Investments in equity affiliates	62,795	79,130
Goodwill and other intangible assets	92,551	96,069
Other assets and due from related party	628,396	448,859
Total assets	15,902,689	17,038,985
Liabilities:
Debt obligations	12,155,124	13,500,562
Allowance for loss-sharing obligations	69,261	57,168
Other liabilities and due to related parties	437,803	409,376
Total liabilities	12,662,188	13,967,106
Structured Business | Operating segments
Assets:
Cash and cash equivalents	499,511	200,514
Restricted cash	410,056	713,615
Loans and investments, net	12,892,796	14,254,674
Loans held-for-sale, net	0	0
Capitalized mortgage servicing rights, net	0	0
Securities held-to-maturity, net	0	0
Investments in equity affiliates	62,795	79,130
Goodwill and other intangible assets	12,500	12,500
Other assets and due from related party	536,789	367,837
Total assets	14,414,447	15,628,270
Liabilities:
Debt obligations	11,800,537	13,195,120
Allowance for loss-sharing obligations	0	0
Other liabilities and due to related parties	323,061	299,559
Total liabilities	12,123,598	13,494,679
Agency Business | Operating segments
Assets:
Cash and cash equivalents	395,787	333,843
Restricted cash	9,102	193
Loans and investments, net	0	0
Loans held-for-sale, net	364,320	354,070
Capitalized mortgage servicing rights, net	392,203	401,471
Securities held-to-maturity, net	155,172	156,547
Investments in equity affiliates	0	0
Goodwill and other intangible assets	80,051	83,569
Other assets and due from related party	91,607	81,022
Total assets	1,488,242	1,410,715
Liabilities:
Debt obligations	354,587	305,442
Allowance for loss-sharing obligations	69,261	57,168
Other liabilities and due to related parties	114,742	109,817
Total liabilities	$ 538,590	$ 472,427

XML

Segment Information - Origination Data (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023 USD ($) loan	Sep. 30, 2022 USD ($) loan	Sep. 30, 2023 USD ($) loan	Sep. 30, 2022 USD ($) loan
Segment Information
Origination Volumes	$ 1,211,347	$ 1,464,235	$ 3,844,769	$ 3,623,649
Agency Business Loan Sales Data:
Gain (loss) on derivative instruments, net	(421)	(15,909)	(3,582)	10,083
Structured Business
Segment Information
Total new loan originations	240,158	774,665	717,186	5,651,119
Loan runoff	664,792	911,790	2,536,661	2,700,748
Structured Business | Bridge loan
Segment Information
Total new loan originations	232,379	756,695	702,062	5,625,010
Structured Business | Mezzanine loans
Segment Information
Total new loan originations	7,779	17,970	15,124	26,109
Structured Business | Multifamily | Bridge loan
Segment Information
Total new loan originations	92,000	592,844	376,630	5,172,770
Structured Business | SFR - Fixed Rate | Bridge loan
Segment Information
Total new loan originations	$ 140,379	$ 163,851	$ 325,432	$ 452,240
Number of Loans Originated | loan	42	52	92	268
SFR Commitments	$ 429,452	$ 457,564	$ 683,984	$ 726,071
Agency Business
Segment Information
Origination Volumes	1,149,849	1,111,321	3,664,149	3,219,014
Agency Business Loan Sales Data:
Loan Sales	$ 1,275,420	$ 1,082,136	$ 3,618,843	$ 3,699,554
Sales margin (fee-based services as a % of loan sales)	1.46%	1.33%	1.54%	1.34%
MSR rate (MSR income as a % of loan commitments)	1.16%	1.33%	1.27%	1.44%
Agency Business | SFR - Fixed Rate
Segment Information
Origination Volumes	$ 2,030	$ 16,678	$ 19,328	$ 55,883
Agency Business Loan Sales Data:
Loan Sales	8,759	43,012	22,931	55,874
Agency Business | Fannie Mae
Segment Information
Origination Volumes	721,398	629,610	2,596,329	1,744,739
Agency Business Loan Sales Data:
Loan Sales	837,132	700,690	2,511,978	1,936,282
Agency Business | Freddie Mac
Segment Information
Origination Volumes	339,241	350,980	658,457	1,057,743
Agency Business Loan Sales Data:
Loan Sales	337,507	288,029	581,306	1,009,557
Agency Business | FHA
Segment Information
Origination Volumes	19,215	78,382	230,707	168,736
Agency Business Loan Sales Data:
Loan Sales	24,057	35,838	201,915	182,755
Agency Business | Private Label
Segment Information
Origination Volumes	67,965	35,671	159,328	191,913
Agency Business Loan Sales Data:
Loan Sales	$ 67,965	$ 14,567	$ 300,713	515,086
Gain (loss) on derivative instruments, net				$ 17,100

XML

Segment Information - Key Servicing Metrics (Details) - Agency Business - MSRs - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
Segment Information
Servicing Portfolio UPB	$ 29,936,707	$ 27,998,029
Wtd. Avg. Servicing Fee Rate (basis points)	0.397%	0.411%
Wtd. Avg. Life of Servicing Portfolio (years)	8 years 3 months 18 days	8 years 7 months 6 days
SFR - Fixed Rate
Segment Information
Servicing Portfolio UPB	$ 287,942	$ 274,764
Wtd. Avg. Servicing Fee Rate (basis points)	0.201%	0.198%
Wtd. Avg. Life of Servicing Portfolio (years)	5 years 9 months 18 days	6 years
Fannie Mae
Segment Information
Servicing Portfolio UPB	$ 20,463,620	$ 19,038,124
Wtd. Avg. Servicing Fee Rate (basis points)	0.483%	0.502%
Wtd. Avg. Life of Servicing Portfolio (years)	7 years 8 months 12 days	8 years
Freddie Mac
Segment Information
Servicing Portfolio UPB	$ 5,184,888	$ 5,153,207
Wtd. Avg. Servicing Fee Rate (basis points)	0.242%	0.25%
Wtd. Avg. Life of Servicing Portfolio (years)	8 years 6 months	9 years
Private Label
Segment Information
Servicing Portfolio UPB	$ 2,371,475	$ 2,074,859
Wtd. Avg. Servicing Fee Rate (basis points)	0.192%	0.185%
Wtd. Avg. Life of Servicing Portfolio (years)	7 years 3 months 18 days	7 years 7 months 6 days
FHA
Segment Information
Servicing Portfolio UPB	$ 1,322,832	$ 1,155,893
Wtd. Avg. Servicing Fee Rate (basis points)	0.145%	0.149%
Wtd. Avg. Life of Servicing Portfolio (years)	19 years 10 months 24 days	19 years 6 months
Bridge loan
Segment Information
Servicing Portfolio UPB	$ 305,950	$ 301,182
Wtd. Avg. Servicing Fee Rate (basis points)	0.112%	0.125%
Wtd. Avg. Life of Servicing Portfolio (years)	3 years 7 months 6 days	1 year 8 months 12 days