Company: ABR-PF
Filing Date: 2025-10-31
Form Type: 10-Q
Source: 0001253986-25-000022
Chunk: 267

Company: ARBOR REALTY TRUST INC
Filing Date: 2025-10-31
Form: 10-Q
Item: Part I, Item 8
Chunk 267
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 2025 that produced lower margins.  

The decrease in income from MSRs was primarily due to a 20% decrease in the MSR rate from 1.23% to 0.99%, partially offset by a 13% increase in loan commitment volume ($411.3 million). The decrease in the MSR rate was mainly due to a decrease in the Fannie Mae MSR rates from lower servicing rates on newer loans, as well as larger portfolio deals in 2025 that produced lower margins. 

The decrease in servicing revenue, net was primarily due to a decrease in earnings on escrow balances from lower average balances and a decrease in the applicable interest rate, partially offset by an increase in servicing fees due to growth in our servicing portfolio.

Other Income (Loss)

The increases in property operating income and expenses were due to the addition of several new REO assets. This is also the reason for the increase in depreciation and amortization.

64

The gains and losses on derivative instruments in 2025 and 2024 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.

The increase in other income, net was primarily due to increases in the fair values of our Private Label loans and loan fees from higher loan originations. 

Other Expenses

The increase in selling and administrative expenses was primarily due to increases in legal and professional fees.

The increase in the provision for loss sharing (net of recoveries) primarily reflects larger specific loan impairment reserves taken in the current year period.

The decrease in the provision for credit losses (net of recoveries) primarily reflects a decrease is specifically impaired loans.

Loss on Extinguishment of Debt

The loss on extinguishment of debt in both 2025 and 2024 reflects deferred financing fees recognized in connection with the unwind of CLOs.

(Loss) Gain on Real Estate

The loss on real estate in 2025 is comprised of a $4.7 million loss on below market debt related to financing the sale of several REO assets and a $1.7 million loss on the foreclosure of loans we took back as REO assets, partially offset by a $1.6 million gain on REO sales. In 2024, we sold a real estate owned asset for $14.2 million and recognized a $3.8 million gain.

Income from Equity Affiliates

Income from equity affiliates in 2025 primarily