Company: MFAN
Filing Date: 2025-02-20
Form Type: 10-K
Source: 0001055160-25-000004
Chunk: 4

Company: MFA FINANCIAL, INC.
Filing Date: 2025-02-20
Form: 10-K
Item: Item 8
Chunk 4
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 provide the Company the ability to increase the level of its investment if certain conditions are met.  At the end of each reporting period, or earlier if circumstances warrant, the Company evaluates whether the nature of its interests and other involvement with the investee entity requires the Company to apply equity method accounting or consolidate the results of the investee entity with the Company’s financial results.  

(d)  Commercial Mortgage LoansThe Company owns two participations in commercial mortgage bridge loans, which are accounted for at fair value under the fair value option, and are classified as Level 3 fair value measurements in the fair value hierarchy. Each of the participations is 75% of the total UPB of the related loans and the remaining interest in each loan was retained by the originator of such loan. The commercial mortgage loans are collateralized by one multifamily property and one office property. The commercial mortgage loans are first liens and bear variable interest rates. The Company has received interests in three of the previously underlying properties, as further described above under “Commercial REO.”

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Table of ContentsMFA FINANCIAL, INC.NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDecember 31, 2024

The following table presents certain additional information about the Company’s commercial mortgage loans:(Dollars In Thousands)Fair Value / Carrying ValueUPBWeighted Average CouponWeighted Average Term to Maturity (Months)UPB 60+ Days DelinquentWeighted Average LTV RatioCommercial Loans - December 31, 2024$7,435 $9,385 11.48 %0$4,875 82 %Commercial Loans - December 31, 2023$51,426 $51,602 13.18 %2$3,521 66 %

(e)   Derivative Instruments  SwapsThe Company’s derivative instruments include Swaps, which are used to economically hedge the interest rate risk associated with certain borrowings.  Pursuant to these arrangements, the Company agreed to pay a fixed rate of interest and receive a variable interest rate, generally based on the Secured Overnight Financing Rate (“SOFR”), on the notional amount of the Swap.  At December 31, 2024, none of the Company’s Swaps were designated as hedges for accounting purposes.  Variation margin payments on the Company’s Swaps are treated as a legal settlement of the exposure under the related Swap contract, the effect of which reduces what would have