Company: MFAN
Filing Date: 2025-08-06
Form Type: 10-Q
Source: 0001055160-25-000013
Chunk: 55

Company: MFA FINANCIAL, INC.
Filing Date: 2025-08-06
Form: 10-Q
Item: Part I, Item 2
Chunk 55
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 certain Multifamily transitional loans, totaling $199.6 million, an after repaired valuation was not obtained and the loan was underwritten based on an “as is” valuation. The LTV of these loans based on the current unpaid principal balance and the valuation obtained during underwriting, is 68%.  Excluded from the calculation of weighted average LTV are certain low value loans secured by vacant lots for which the LTV ratio is not meaningful.

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The following table presents the five largest geographic concentrations by state of certain of our residential whole loan portfolio and in total as of June 30, 2025:

Non-QM loansBusiness purpose loansLegacy RPL/NPL loansAll LoansRankStatePercent of UPBStatePercent of UPBStatePercent of UPBStatePercent of UPB1CA46.5%FL12.1%CA22.4%CA28.9%2FL17.9%TX10.9%NY16.2%FL14.5%3TX5.3%GA9.1%FL7.3%TX6.8%4AZ3.3%NC5.8%NJ7.0%NY4.8%5WA2.3%OH5.4%MD5.0%GA4.4%

CRT Securities

We are exposed to potential credit losses from our investments in CRT securities issued by or sponsored by Fannie Mae and Freddie Mac.  While CRT securities are issued by or sponsored by these government-sponsored enterprises, payment of principal on these securities is not guaranteed.  As an investor in a CRT security, we may incur a loss if losses on the mortgage loans in the reference pool exceed the credit enhancement on the underlying CRT security owned by us or if an actual pool of loans experience losses.  We assess the credit risk associated with our investments in CRT securities by assessing the current and expected future performance of the associated loan pool. 

Credit Spread Risk

Credit spreads measure the additional yield demanded by investors in financial instruments based on the credit risk associated with an instrument relative to benchmark interest rates.  They are impacted by the available supply and demand for instruments with various levels of credit risk.  Widening credit spreads would result in higher yields being required by investors in financial instruments.  Credit spread widening generally results in lower values of the financial instruments we hold at that time, but will generally result in a higher yield on future investments with similar credit risk.  It is possible that the credit spreads on our assets and liabilities, including