Company: NREF
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0001628280-25-052000
Chunk: 110

Company: NexPoint Real Estate Finance, Inc.
Filing Date: 2025-11-13
Form: 10-Q
Item: Item 8
Chunk 110
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 result, the IQHQ Bridge Warrants are being fair valued using an option pricing model that considers both short and long-term exit scenario. The model incorporates economic and control rights, marketability of the Units, and other market-derived metrics, applying discounts for lack of marketability and control due to the minority stake and absence of public trading options.

As of September 30, 2025, the Company has funded $137.0 million of IQHQ Subscription Agreement, with an unfunded commitment balance of $23.0 million.

The table below shows the Company's unfunded commitments by investment type as of September 30, 2025 and December 31, 2024 (in thousands):

Investment TypeSeptember 30, 2025December 31, 2024Unfunded Commitments Unfunded CommitmentsLoans$59,929 $64,217 Preferred Equity3,055 7,874 Common Equity1,536 2,536 Preferred Stock23,000 150,000 $87,520 $224,627 

Critical Accounting Policies and Estimates

Management’s discussion and analysis of financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial 

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statements requires our management to make judgments, assumptions and estimates that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We evaluate these judgments, assumptions and estimates for changes that would affect the reported amounts. These estimates are based on management’s historical industry experience and on various other judgments and assumptions that are believed to be reasonable under the circumstances. Actual results may differ from these judgments, assumptions and estimates. Below is a discussion of the accounting policies and estimates that involve significant estimation uncertainty that have or are reasonably likely to have a material impact on our financial condition or results of operations. A discussion of recent accounting pronouncements and our significant accounting policies, including further discussion of the accounting policies described below, can be found in Note 2 to our consolidated financial statements.

Allowance for Credit Losses

In periods ending on or prior to December 31, 2022, the Company, with the assistance of an independent valuations firm, performed a quarterly evaluation of loans classified as held for investment for impairment on a loan-by-loan basis in accordance with ASC 310-10-35, Receivables, Subsequent Measurement (“ASC 310-10-35”). If the Company determined