| FAIR VALUE |
FAIR VALUE The following tables summarize the valuation of the Company’s assets and liabilities carried at fair value on a recurring basis within the fair value hierarchy levels as of December 31, 2025 and December 31, 2024: FAIR VALUE | | | | | | | | | | | | | | | | | | | | | | | | | | December 31, 2025 | | Quoted prices in active markets for identical assets Level 1 | | Significant other observable inputs Level 2 | | Unobservable inputs Level 3 | | Balance as of December 31,
2025 | | Assets: | | | | | | | | | Mortgage servicing rights | $ | — | | | $ | — | | | $ | 554,246 | | | $ | 554,246 | | | Total | $ | — | | | $ | — | | | $ | 554,246 | | | $ | 554,246 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | December 31, 2024 | | Quoted prices in active markets for identical assets Level 1 | | Significant other observable inputs Level 2 | | Unobservable inputs Level 3 | | Balance as of December 31,
2024 | | Assets: | | | | | | | | | Mortgage servicing rights | $ | — | | | $ | — | | | $ | 649,287 | | | $ | 649,287 | | | Total | $ | — | | | $ | — | | | $ | 649,287 | | | $ | 649,287 | |
As of December 31, 2025 and December 31, 2024, the Company had $554,246 and $649,287, respectively, in Level 3 assets. The Company’s Level 3 assets are comprised of MSRs. For more detail about Level 3 assets, also see Notes 2 and 7. The following table provides quantitative information about the significant unobservable inputs used in the fair value measurement of the Company’s MSRs classified as Level 3 fair value assets at December 31, 2025 and December 31, 2024: | | | | | | | | | | | | | | | | | | | As of December 31, 2025 | | Valuation Technique | Unobservable Input | | Range | | Weighted Average | | Discounted cash flow | Constant prepayment rate | | 7.0 - 8.6% | | 7.8 | % | | | Discount rate | | 12.0 | % | | 12.0 | % |
| | | | | | | | | | | | | | | | | | | As of December 31, 2024 | | Valuation Technique | Unobservable Input | | Range | | Weighted Average | | Discounted cash flow | Constant prepayment rate | | 7.0 - 8.6% | | 7.9 | % | | | Discount rate | | 12.0 | % | | 12.0 | % |
As discussed in Note 2, GAAP requires disclosure of fair value information about financial instruments, whether or not recognized in the consolidated balance sheets, for which it is practicable to estimate that value. The following table details the carrying amount, face amount and fair value of the financial instruments described in Note 2:
| | | | | | | | | | | | | | | | | | | | | | | | | | December 31, 2025 | | | Level in Fair Value Hierarchy | Carrying Value | | Face Amount | | Fair Value | | Assets: | | | | | | | | | Cash and cash equivalents | | 1 | $ | 23,112,995 | | | $ | 23,112,995 | | | $ | 23,112,995 | | | Restricted cash | | 1 | 3,505,087 | | | 3,505,087 | | | 3,505,087 | | | Commercial mortgage loans held-for-investment | | 3 | 1,114,047,992 | | | 1,140,268,217 | | | 1,119,645,026 | | | Total | | | $ | 1,140,666,074 | | | $ | 1,166,886,299 | | | $ | 1,146,263,108 | | | | | | | | | | | Liabilities: | | | | | | | | | Collateralized loan obligations | | 2 | 748,433,484 | | | $ | 754,638,462 | | | $ | 756,051,842 | | | Master repurchase agreement | | 3 | 175,204,869 | | | 177,193,781 | | | 175,204,869 | | | Term lending agreement | | 3 | 16,738,351 | | | 17,000,000 | | | 16,738,351 | | | Secured term loan | | 3 | 47,719,278 | | | 47,750,000 | | | 47,746,394 | | | Total | | | $ | 988,095,982 | | | $ | 996,582,243 | | | $ | 995,741,456 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | December 31, 2024 | | | Level in Fair Value Hierarchy | Carrying Value | | Face Amount | | Fair Value | | Assets: | | | | | | | | | Cash and cash equivalents | | 1 | $ | 69,173,444 | | | $ | 69,173,444 | | | $ | 69,173,444 | | | Restricted cash | | 1 | 2,390,654 | | | 2,390,654 | | | 2,390,654 | | | Commercial mortgage loans held-for-investment | | 3 | 1,048,803,078 | | | 1,065,563,644 | | | 1,061,313,204 | | | Total | | | $ | 1,120,367,176 | | | $ | 1,137,127,742 | | | $ | 1,132,877,302 | | | | | | | | | | | Liabilities: | | | | | | | | | Collateralized loan obligations | | 2 | $ | 828,390,189 | | | $ | 830,698,696 | | | $ | 824,857,756 | | | Secured term loan | | 3 | $ | 47,470,094 | | | $ | 47,750,000 | | | $ | 47,227,497 | | | Total | | | $ | 875,860,283 | | | $ | 878,448,696 | | | $ | 872,085,253 | |
Estimates of cash and cash equivalents and restricted cash are measured using quoted prices, or Level 1 inputs. Estimates of the fair value of collateralized loan obligations and secured financings are measured using observable, quoted market prices, in active markets, or Level 2 inputs. All other fair value significant estimates are measured using unobservable inputs, or Level 3 inputs. See Note 2 for further discussion regarding fair value measurement of certain of our assets and liabilities.
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