Company: MFAN
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001055160-25-000018
Chunk: 6

Company: MFA FINANCIAL, INC.
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 2
Chunk 6
---
 September 30, 2025, the average CPRs on certain of our loan portfolios were: 13.3% for Non-QM loans, 12.2% for Single-family rental loans, and 9.4% for Legacy RPL/NPL loans.  In addition, for the three months ended September 30, 2025, the repayment rate (which includes both scheduled and unscheduled repayments of principal) was 70.0% for our Single-family transitional loans and 44.6% for our Multifamily transitional loans.

It is generally our business strategy to hold our residential mortgage assets as long-term investments. As part of Lima One’s mortgage banking activities, from time to time, we sell certain loans shortly after origination.  On at least a quarterly basis, excluding investments for which the fair value option has been elected or for which specialized loan accounting is otherwise applied, we assess our ability and intent to continue to hold each asset and, as part of this process, we monitor our investments in securities that are designated as AFS for impairment.  A change in our ability and/or intent to continue to hold any of these securities that are in an unrealized loss position, or a deterioration in the underlying characteristics of these securities, could result in our recognizing future impairment charges or a loss upon the sale of any such security.  

Our residential mortgage investments have longer-term contractual maturities than our non-securitization related financing liabilities, and the interest rates we pay on our non-securitization related financings will typically change at a faster pace than the interest rates we earn on our investments.  In order to reduce this interest rate risk exposure, we may enter into derivative instruments, which currently include Swaps.  

61  

Recent Market Conditions and Our Strategy

During the third quarter of 2025, fixed-income market conditions were mixed as investors reacted to evolving macroeconomic data and changing monetary policy expectations. In September 2025, the Federal Reserve reduced the Federal Funds rate by 25 basis points, and reinforced market expectations for further rate reductions in the near term. Fixed-income markets delivered positive returns, with the Bloomberg US Aggregate Index returning 2.03% for the third quarter. During the quarter, we were able to add $1.2 billion of our target assets at attractive yields. These additions included approximately $452.8 million of Non-QM loans, approximately $225.9 million of funded originations of Business purpose loans and draws on existing Transitional loans by Lima