XML 36 R14.htm IDEA: XBRL DOCUMENT v3.26.1
Commercial Loans
 12 Months Ended
Dec. 31, 2025
Receivables [Abstract]  
Commercial Loans

 

4. Commercial Loans

 

Loans Receivable

 

The Company offers short-term secured non–banking loans to real estate investors (also known as hard money loans) to fund their acquisition and construction of properties located in the New York metropolitan area, including New Jersey and Connecticut, and in Florida. The loans are principally secured by collateral consisting of real estate and accompanied by personal guarantees from the principals of the borrowers. The loans are generally for a term of one year. The short-term loans are initially recorded, and carried thereafter, in the consolidated financial statements at cost. Most of the loans provide for receipt of interest only during the term of the loan and a balloon payment at the end of the term.

 

For the years ended December 31, 2025 and 2024, the total amounts of $35,336,316 and $41,965,844, respectively, have been lent, offset by collections received from borrowers, under the commercial loans in the amount of $40,636,706 and $49,089,982, respectively. The face amounts of the loans the Company originated in the past seven years have ranged from a minimum of $40,000 to a maximum of $3,600,000. The Company’s board of directors established a policy limiting the maximum amount of any loan to the lower of (i) 9.9% of the aggregate amount of the Company’s loan portfolio (not including the loan under consideration) and (ii) $4 million. The Company’s loans typically have a maximum initial term of 12 months and bear interest at a fixed rate of 9% to 12.5% per year. In addition, the Company usually receives origination fees, or “points,” ranging from 0% to 2% of the original principal amount of the loan as well as other fees relating to underwriting, funding and managing the loan. Interest is always payable monthly, in arrears. In the case of acquisition financing, the principal amount of the loan usually does not exceed 75% of the value of the property (as determined by an independent appraiser), and in the case of construction financing, up to 80% of construction costs.

 

 

At December 31, 2025, the Company was committed to $4,402,556 in construction loans that can be drawn by the borrowers when certain conditions are met.

 

At December 31, 2024, the Company has made loans to four different entities in the aggregate amount of $7,225,000, or 11.0% of its loan portfolio. One individual holds at least a fifty percent interest in each of the different entities. This individual is not affiliated with any officers or directors of the Company. At December 31, 2025, the Company has made loans to three different entities in the aggregate amount of $6,245,000, or 10.3% of its loan portfolio. One individual holds at least a fifty percent interest in each of the different entities. This individual is not affiliated with any officers or directors of the Company.

 

The Company generally grants loans for a term of one year. When a performing loan reaches its maturity and the borrower requests an extension, the Company may extend the term of the loan beyond one year. Prior to granting an extension of any loan, the Company reevaluates the underlying collateral.

 

Credit Risk

 

Credit risk profile based on loan activity as of December 31, 2025 and 2024:

Performing loans  Developers-Residential   Developers-Commercial  

Developers-Mixed

Use

  

Total

outstanding loans

 
December 31, 2025  $51,858,921   $7,314,954   $1,500,000   $60,673,875 
December 31, 2024  $56,149,265   $7,380,000   $2,445,000   $65,974,265 

 

At December 31, 2025, the Company’s loans receivable consisted of loans in the amount of $2,800, $920,250, $1,975,000, $7,111,624, $9,506,620 and $20,293,265, originally due or committed to lend to borrowers in 2016, 2020, 2022, 2023, 2024 and 2025, respectively. At December 31, 2024, the Company’s loans receivable consisted of loans in the amount of $18,756, $1,520,250, $120,000, $3,725,000, $13,738,817 and $17,155,000, originally due or committed to lend to borrowers in 2016, 2020, 2021, 2022, 2023 and 2024, respectively.

 

Generally, borrowers are paying their interest, and the Company receives a fee in connection with the extension of the loans. In all instances, the borrowers have either signed an extension agreement or are in the process of signing an extension. Accordingly, at December 31, 2025, no loan impairments exist and there are no provisions for impairment credit losses of loans or recoveries thereof.

 

In September 2025, the Company sold one of its loans receivable at its face value of $250,000.

 

Subsequent to the balance sheet date, approximately $10,931,000 of the loans receivable at December 31, 2025 were paid down or paid off, including approximately $6,353,000 originally due on or before December 31, 2025.