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OTHER NOTES RECEIVABLE

6 Months Ended

Jun. 30, 2026

5. OTHER NOTES RECEIVABLE

Other notes receivable relate to notes issued to mobile home park owners and dealers and are not directly tied to the sale of manufactured homes. These other notes have varying maturity dates and generally require monthly principal and interest payments. They are collateralized by mortgages on real estate, manufactured homes that we have financed for which the borrower uses as offices, as well as vehicles. These notes typically are personally guaranteed by the borrowers. The interest rates on the other notes generally are fixed and range from 5.0% to 17.5%. The Company reserves for estimated losses on the other notes based on current economic conditions that may affect the borrower’s ability to pay, the borrower’s financial strength, and historical loss experience.

As of June 30, 2026, the Company had concentrations of other notes receivable with three independent third-parties and their respective affiliates that equated to 19.2%, 18.1%, and 17.1% of the principal balance outstanding, all of which were secured by the manufactured homes. As of December 31, 2025, the Company had concentrations of other notes receivable with three independent third-parties and their respective affiliates that equated to 54.9%, 10.6%, and 9.2% of the principal balance outstanding, all of which were secured by the manufactured homes.

As of June 30, 2026, and December 31, 2025 there were past due balances of $0.2 million on other notes.

For the three months and six months ended June 30, 2026 and 2025, there were no charge offs recorded for other notes. Allowance for loan loss for the other notes was $0.2 million as of June 30, 2026 and December 31, 2025. As of June 30, 2026 and December 31, 2025, the impaired balance of other notes was $0.1 million. Collateral for repossessed loans is acquired through foreclosure or similar proceedings and is recorded at the estimated fair value of the home, less the costs to sell.

Other notes receivable, net of allowance for loan losses and deferred financing fees, consisted of the following (in thousands):


		As of June 30,		As of December 31,			As of December 31,
		2026		2025			2024
Outstanding principal balance		$	3,478	$	6,380		$	15,412
Loan discount and deferred financing fees			(66)		(57)			(132)
Allowance for loan losses			(164)		(229)			(364)
Total		$	3,248	$	6,094		$	14,916

The following table presents a detail of the activity in the allowance for loan losses (in thousands):


	Three months ended				Six months ended
	June 30,				June 30,
	2026		2025		2026		2025
Allowance for loan losses, beginning of period	$	240	$	468	$	229	$	364
Provision for loan losses		(76)		(36)		(65)		68
Allowance for loan losses, end of period	$	164	$	432	$	164	$	432

We evaluate the credit quality of our Other notes receivable portfolio based on the aging status of the loan and by payment activity. Loan delinquency reporting generally is based on borrower payment activity relative to the contractual terms of the loan. The following table disaggregates the outstanding principal balance of Other notes receivable by credit quality indicator based on delinquency status and fiscal year of origination and is presented as of June 30, 2026 (in thousands):


	Year of Origination
	2026		2025		2024		2023		2022		Prior		Total		% of Portfolio
< 30 days past due	$	629	$	1,447	$	120	$	25	$	—	$	22	$	2,243		64.5%
30-90 days past due		—		—		—		—		—		—		—		—
> 90 days past due		—		286		—		949		—		—		1,235		35.5%
Total	$	629	$	1,733	$	120	$	974	$	—	$	22	$	3,478		100%