Other Operating Expenses. Other operating expenses consist of general and administrative costs such as travel and entertainment, marketing, data processing, insurance and office equipment.

Provision for Income Taxes

The provision for income taxes consists of the current and deferred U.S. federal and state income taxes we expect to pay, currently and in future years, with respect to the net income for the year. The amount of the provision is derived by adjusting our reported net income with various permanent differences. The tax-adjusted net income amount is then multiplied by the applicable federal and state income tax rates to arrive at the provision for income taxes.

The following tables distinguish between the changes in interest income attributable to changes in average loan balance (volume) and the changes in interest income attributable to changes in annualized yield (rate) for the three and nine months ended September 30, 2025 and 2024.

Interest Expense — Portfolio Related. Portfolio related interest expense, which consists of interest incurred on our warehouse facilities and securitized debt, increased to $88.9 million for the three months ended September 30, 2025 from $63.9 million for the three months ended September 30, 2024. Portfolio related interest expense increased to $245.8 million for the nine months ended September 30, 2025 from $178.7 million for the nine months ended September 30, 2024. The increases were primarily attributable to a higher loan portfolio being financed and increased interest rates.

The following tables present information regarding portfolio related interest expense and distinguish between the changes in interest expense attributable to changes in the average outstanding debt balance (volume) and changes in cost of funds (rate) for the three and nine months ended September 30, 2025 and 2024.

Interest Expense — Corporate Debt. Corporate debt interest expense remained consistent at $6.1 million for each of the three months ended September 30, 2025 and 2024. Corporate debt interest expense increased to $18.4 million for the nine months ended September 30, 2025, compared to $17.7 million for the nine months ended September 30, 2024, primarily due to the issuance of $75.0 million of additional secured debt in February 2024.

Provision for Credit Losses. Our provision for credit losses increased to $0.4 million for the three months ended September 30, 2025 from a $0.1 million reversal of provision for the three months ended September 30, 2024, due mainly to an increase in individually-assessed allowance. Our provision for credit losses increased to $3.9 million for the nine months ended September 30, 2025 from $1.2 million for the nine months ended September 30, 2024. The increased provision for credit losses was primarily attributable to charge-offs taken during the quarter ended June 30, 2025 and an increase in the individually-assessed allowance.

Other Operating Income

The $16.3 million increase in total other operating income from the three months ended September 30, 2024 to the three months ended September 30, 2025 was primarily due to improved securitized bond prices resulting in lower unrealized loss on fair value securitized debt and increased loan origination fee income, offset by lower unrealized gain on fair value loans. The $41.3 million increase from the nine months ended September 30, 2024 to the nine months ended September 30, 2025 was mainly due to increased origination volumes driving a higher unrealized gain on fair value loans and an increase in loan origination fee income.

Gain on Disposition of Loans. Gain on disposition of loans increased by $2.3 million to $4.6 million for the three months ended September 30, 2025 compared to $2.3 million for the three months ended September 30, 2024. Gain on disposition of loans increased by $6.5 million to $13.7 million for the nine months ended September 30, 2025 compared to $7.2 million for the nine months ended September 30, 2024. The increases were primarily due to the increase in gain on transfer to REO upon foreclosure.

Unrealized Gain on Fair Value Loans. Unrealized gain on fair value loans decreased by $4.5 million to $31.0 million for the three months ended September 30, 2025 compared to $35.5 million for the three months ended September 30, 2024. The decrease was mainly driven by a higher nonperforming loan balance. Unrealized gain on fair value loans increased by $24.1 million to $95.7 million for the nine months ended September 30, 2025 compared to $71.6 million for the nine months ended September 30, 2024. The increase was mainly driven by new loan originations.

Unrealized Loss on Fair Value Securitized Debt. Unrealized loss on fair value securitized debt decreased by $15.0 million to $10.0 million for the three months ended September 30, 2025 from $25.0 million for the three months ended September 30, 2024. Unrealized loss on fair value securitized debt decreased by $0.7 million to $31.3 million for the nine months ended September 30, 2025 from $32.0 million for the nine months ended September 30, 2024. The decreases in unrealized loss on fair value securitized debt were primarily attributable to the decrease in market interest rates and spreads.

Unrealized Gain (Loss) on Mortgage Servicing Rights. Unrealized loss on mortgage servicing rights was $0.3 million for the three months ended September 30, 2025 as compared to $1.0 million for the three months ended September 30, 2024. The decrease in unrealized loss on mortgage servicing rights was mainly driven by an increase in the loan servicing portfolio. Unrealized loss on mortgage servicing rights was $1.1 million for the nine months ended September 30, 2025 as compared to $0.9 million for the nine months ended September 30, 2024. The increase in unrealized loss on mortgage servicing rights resulted from an increase in prepayment rate.

Origination Fee Income. Origination fee income increased by $3.0 million to $9.7 million for the three months ended September 30, 2025 compared to $6.7 million for the three months ended September 30, 2024. Origination fee income increased by $10.6 million to $27.3 million for the nine months ended September 30, 2025 compared to $16.8 million for the nine months ended September 30, 2024. The increases were driven by higher loan originations.

Interest Income on Cash Balance. Interest income on cash balance decreased by $0.1 million to $1.6 million for the three months ended September 30, 2025 compared to $1.7 million for the three months ended September 30, 2024. Interest income on cash balance decreased by $0.6 million to $4.4 million for the nine months ended September 30, 2025 compared to $5.0 million for the nine months ended September 30, 2024. The decreases were attributable to a decrease in interest rates.

Other Income. Other income was $0.6 million and $0.5 for the three months ended September 30, 2025 and 2024, respectively. Other income increased to $1.6 million for the nine months ended September 30, 2025 compared to $1.4 million for the nine months ended September 30, 2024. The increase was mainly driven by higher servicing fee income from the increase in our loan servicing portfolio.

Compensation and Employee Benefits. Compensation and employee benefits increased by $5.7 million to $23.3 million for the three months ended September 30, 2025 compared to $17.6 million for the three months ended September 30, 2024. Compensation and employee benefits increased by $18.1 million to $67.6 million for the nine months ended September 30, 2025 compared to $49.5 million for the nine months ended September 30, 2024. The increases were mainly driven by higher headcount and commissions expense as loan originations increased.

Origination Expenses. Origination expenses increased by $0.3 million to $1.2 million for the three months ended September 30, 2025 from $0.9 million for the three months ended September 30, 2024. Origination expenses increased by $0.9 million to $3.2 million for the nine months ended September 30, 2025 from $2.3 million for the nine months ended September 30, 2024. The increases in origination expenses were due to higher loan originations.

Securitization Expenses. Securitization expenses were $6.4 million for the three months ended September 30, 2025 compared to $3.2 million for the three months ended September 30, 2024. Securitization expenses were $22.0 million for the nine months ended September 30, 2025 compared to $12.3 million for the nine months ended September 30, 2024. The increases in securitization expenses resulted from more securitization transactions and securitized debt issued in 2025 as compared to the prior year.

Loan Servicing. Loan servicing expenses increased to $7.7 million for the three months ended September 30, 2025 from $5.7 million for the three months ended September 30, 2024. Loan servicing expenses increased to $24.0 million for the nine months ended September 30, 2025 from $15.6 million for the nine months ended September 30, 2024. The increases were primarily attributable to the growth of our loan portfolio.

Professional Fees. Professional fees decreased to $0.9 million for the three months ended September 30, 2025 compared to $2.3 million for the three months ended September 30, 2024. Professional fees were $4.7 million and $6.1 million for the nine months ended September 30, 2025 and 2024, respectively. The decreases were primarily attributable to lower legal fees.

Rent and Occupancy. Rent and occupancy expenses decreased to $0.3 million for the three months ended September 30, 2025 compared to $0.5 million for the three months ended September 30, 2024. Rent and occupancy expenses decreased to $0.8 million for the nine months ended September 30, 2025 compared to $1.6 million for the nine months ended September 30, 2024. The decreases resulted from the relocation to offices with less space and lower rent expense.

Real Estate Owned, Net. Net expenses of real estate owned increased to $7.9 million for the three months ended September 30, 2025 from $2.0 million for the three months ended September 30, 2024. Net expenses of real estate owned increased to $14.3 million for the nine months ended September 30, 2025 from $5.8 million for the nine months ended September 30, 2024. The increases were mainly due to the increase in REOs combined with higher valuation adjustments.

Other Operating Expenses. Other operating expenses increased to $2.7 million for the three months ended September 30, 2025 from $2.5 million for the three months ended September 30, 2024. Other operating expenses increased to $8.0 million for the nine months ended September 30, 2025 from $7.3 million for the nine months ended September 30, 2024. The increases were mainly due to higher information technology maintenance and data processing costs.

Income Tax Expense. Income tax expense was $10.0 million and $5.6 million for the three months ended September 30, 2025 and 2024, respectively, and $26.0 million and $16.7 million for the nine months ended September 30, 2025 and 2024, respectively. Our annual consolidated effective tax rates were 27.4% and 28.5% for the years 2025 and 2024, respectively.

Quarterly Results of Operations

The following table sets forth certain unaudited financial information for each of the last eight completed quarters. The quarterly information has been prepared on the same basis as the consolidated financial statements and includes all adjustments (consisting of normal recurring adjustments) that, in the opinion of management, are necessary for a fair presentation of the information presented. This information should be read in conjunction with the consolidated financial statements and related notes thereto included elsewhere in this Quarterly Report. Operating results for interim periods are not necessarily indicative of the results that may be expected for a full year.

Liquidity and Capital Resources

Sources and Uses of Liquidity

We fund our lending activities primarily through borrowings under our warehouse repurchase facilities, securitized debt, other corporate-level debt, equity and debt securities, and net cash provided by operating activities to manage our business. We use cash to originate and acquire investor real estate loans, repay principal and interest on our borrowings, fund our operations and meet other general business needs.

Cash and Cash Equivalents

Our total liquidity was $143.5 million as of September 30, 2025, comprised of $99.0 million in cash and $44.5 million in borrowings from available warehouse capacity on unencumbered loans. Our additional available warehouse capacity as of September 30, 2025, was $555.8 million, bringing total liquidity plus available warehouse capacity to $699.3 million.

We had cash of $99.0 million and $44.1 million, excluding restricted cash of $18.8 million and $23.2 million as of September 30, 2025 and 2024, respectively.

Cash flows from operating activities primarily includes net income adjusted for: (1) cash used for origination of held for sale loans and the related cash proceeds from the sales of such loans, (2) non-cash items including valuation changes, provision for credit losses, discount accretion, and amortization of debt issuance discount and costs, and (3) changes in the balances of operating assets and liabilities.

For the nine months ended September 30, 2025, our net cash provided by operating activities consisted mainly of $70.2 million in net income, $47.0 million in proceeds from sale of loans held for sale, and $31.3 million change in valuation of securitized debt at fair value, partially offset by $95.7 million change in valuation of loans carried at fair value and $47.9 million in origination of loans held for sale.

For the nine months ended September 30, 2025, our net cash used in investing activities consisted mainly of $2.0 billion in cash used to originate loans held for investment at fair value, partially offset by $0.7 billion in cash received from payments of loans held for investment.

For the nine months ended September 30, 2025, our net cash provided by financing activities consisted mainly of $2.1 billion in borrowings from our warehouse and repurchase facilities and $2.0 billion in proceeds from issuing securitized debt. The cash generated was partially offset by repayments of $2.1 billion and $0.7 billion, on our warehouse and repurchase facilities and securitized debt, respectively.

During the nine months ended September 30, 2025 and 2024, we generated approximately $47.0 million and $5.3 million, respectively, of net cash and cash equivalents on operating, investing and financing activities.

Warehouse Facilities

As of September 30, 2025, we had five non-mark-to-market warehouse facilities, one mark-to-market warehouse facility, and one modified mark-to-market warehouse facility to support our loan origination and acquisition facilities. The maturity of our warehouse facilities ranges from one to three years. The borrowings are collateralized primarily by performing loans. All warehouse facilities are based on SOFR, plus margins ranging from 1.60% to 4.00%. Borrowing under these facilities was $334.7 million with $600.3 million of available capacity as of September 30, 2025.

Six warehouse facilities fund less than 100% and one warehouse facility funds at 100% of the principal balance of the mortgage loans we own, requiring us to use working capital to fund the remaining portion. We may need to use additional working

capital if loans become delinquent, because the amount permitted to be financed by the facilities may change based on the delinquency performance of the pledged collateral.

All borrower payments on loans financed under the warehouse facilities are segregated into pledged accounts with the loan servicer. All principal amounts in excess of the interest due are applied to reduce the outstanding borrowings under the warehouse facilities. The warehouse facilities also contain customary covenants, including financial covenants that require us to maintain minimum liquidity, a minimum net worth, a maximum debt-to-net worth ratio and a ratio of a minimum earnings before interest, taxes, depreciation and amortization of interest expense. If we fail to meet any of the covenants, or otherwise default under the facilities, the lenders have the right to terminate their facility and require immediate repayment, which may require us to sell our loans at less than optimal terms. As of September 30, 2025, we were in compliance with these covenants.

Securitized debt

From May 2011 through September 2025, we have completed 44 transactions, issuing $9.9 billion in principal amount of securities to third parties. All borrower payments are segregated into remittance accounts at the primary servicer and remitted to the trustee of each trust monthly. We are the sole beneficial interest holder of the applicable trusts, which are variable interest entities included in our consolidated financial statements. The transactions are accounted for as secured borrowings under U.S. GAAP. The following table summarizes the securities issued, securities retained by us at the time of the securitization, as of September 30, 2025 and December 31, 2024, and the stated maturity for each securitized debt. The securities are callable by us when the stated principal balance is less than a certain percentage, ranging from 10% to 30%, of the original stated principal balance of loans at issuance. As a result, the actual maturity date of the securities issued will likely be earlier than their respective stated maturity date.