| Segment Reporting |
Segment Reporting As noted above, prior to the first quarter of 2025, the Company had only one reportable operating segment. Beginning with the first quarter of 2025, the Company has two reportable operating segments: Residential and Commercial. Segment information for prior periods has been recast to reflect this change. Activities that are not directly attributable or not allocated to any of the reportable segments are reported under Corporate as a reconciling item to the Company’s consolidated financial statements. The activities within Corporate primarily consist of general and administrative expenses, corporate cash, related interest income and interest expense on corporate debt, which included the 2027 Notes (as defined below) and, prior to their settlement in 2024, the 2024 Notes. See Note 2 for additional details on the Company’s segments.
The structure of the reportable segments is differentiated by the financial information used by the CODM and the nature of the Company’s business activities, which is consistent with the reporting structure of the Company’s internal organization. The Company conducts its business and generates substantially all of its revenues in the U.S.
Income before income taxes is the measure of segment profit and loss that is determined in accordance with the measurement principles used in measuring the corresponding amounts in the consolidated financial statements and used by the CODM to evaluate segment results. It is also one of the factors considered in determining capital allocation among the segments, assessing performance for each segment.
The following tables summarize segment financial information and financial information for the Corporate category, as applicable: | | | | | | | | | | | | | | | | | | | | | | | | | | | Year ended December 31, 2025 | | | ($ in thousands) | Residential | | Commercial | | Corporate
Category | | Total | | | | Interest income | $ | 31,676 | | | $ | 17,803 | | | $ | 3,321 | | | $ | 52,800 | | | | | Interest expense | (14,262) | | | (10,537) | | | (12,588) | | | (37,387) | | | | | Net interest income (expense) | 17,414 | | | 7,266 | | | (9,267) | | | 15,413 | | | | | | | | | | | | | | | Related party loan servicing fee | 1,964 | | | — | | | — | | | 1,964 | | | | | Related party management fee | — | | | — | | | 6,253 | | | 6,253 | | | | | Professional fees | — | | | 38 | | | 3,574 | | | 3,612 | | | | | General and administrative | 198 | | | 134 | | | 3,828 | | | 4,160 | | | | | Total expense | 2,162 | | | 172 | | | 13,655 | | | 15,989 | | | | | | | | | | | | | | | Net change in the allowance for credit losses | 7,003 | | | — | | | — | | | 7,003 | | | | | Unrealized gain on residential mortgage loans held-for-sale, net | 5,892 | | | — | | | — | | | 5,892 | | | | | | | | | | | | | | | | | | | | | | | | | Other loss | (2,451) | | | (7,937) | | | (397) | | | (10,785) | | | | | Total other gain (loss) | 10,444 | | | (7,937) | | | (397) | | | 2,110 | | | | | | | | | | | | | | | Income (loss) before income taxes | 25,696 | | | (843) | | | (23,319) | | | 1,534 | | | | | Income tax expense (benefit) | (35) | | | — | | | 95 | | | 60 | | | | | Net Income (Loss) | $ | 25,731 | | | $ | (843) | | | $ | (23,414) | | | $ | 1,474 | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | Year ended December 31, 2024 | | | ($ in thousands) | Residential | | Commercial | | Corporate
Category | | Total | | | | Interest income | $ | 44,036 | | | $ | 4,704 | | | $ | 4,134 | | | $ | 52,874 | | | | | Interest expense | (30,101) | | | — | | | (13,471) | | | (43,572) | | | | | Net interest income (expense) | 13,935 | | | 4,704 | | | (9,337) | | | 9,302 | | | | | | | | | | | | | | | Related party loan servicing fee | 4,175 | | | — | | | — | | | 4,175 | | | | | Related party management fee | — | | | — | | | 23,276 | | | 23,276 | | | | | Professional fees | — | | | — | | | 3,413 | | | 3,413 | | | | | General and administrative | — | | | — | | | 9,026 | | | 9,026 | | | | | Total expense | 4,175 | | | — | | | 35,715 | | | 39,890 | | | | | | | | | | | | | | | Net change in the allowance for credit losses | (5,087) | | | — | | | — | | | (5,087) | | | | | Unrealized loss on residential mortgage loans held-for-sale, net | (54,537) | | | — | | | — | | | (54,537) | | | | | Fair value adjustment on mark-to-market liabilities | — | | | — | | | 3,078 | | | 3,078 | | | | | | | | | | | | | | | Other (loss) gain | (9,112) | | | 1,205 | | | 2,136 | | | (5,771) | | | | | Total other (loss) gain | (68,736) | | | 1,205 | | | 5,214 | | | (62,317) | | | | | | | | | | | | | | | (Loss) income before taxes | (58,976) | | | 5,909 | | | (39,838) | | | (92,905) | | | | | Income tax expense | — | | | — | | | 145 | | | 145 | | | | | Net (Loss) income | $ | (58,976) | | | $ | 5,909 | | | $ | (39,983) | | | $ | (93,050) | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | ($ in thousands) | Residential | | Commercial | | Corporate
Category | | Total | | | As of December 31, 2025 | | | | | | | | | | | Total assets | $ | 588,704 | | | $ | 370,949 | | | $ | 81,874 | | | $ | 1,041,527 | | | | | Equity method investments | — | | | 79,168 | | | — | | | 79,168 | | | | As of December 31, 2024 | | | | | | | | | | | Total assets | $ | 631,324 | | | $ | 276,530 | | | $ | 69,485 | | | $ | 977,339 | | | | | Equity method investments | — | | | — | | | 538 | | | 538 | | | |
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