Loan Portfolio and Performance - As of June 30, 2022, the company's loan portfolio totaled $3.1 billion, with an average loan balance of approximately $397,000 and a weighted average loan-to-value (LTV) ratio of 68.2%[119] - Nonperforming loans represented 8.16% of the total loan portfolio as of June 30, 2022, down from 10.56% as of December 31, 2021[141] - Total loan originations for the three months ended June 30, 2022, were $445.4 million, a decrease of $136.0 million from $581.4 million in the previous quarter, but an increase of $189.0 million, or 73.6%, from $256.5 million in the same quarter of 2021[146] - The unpaid principal balance (UPB) of loans held for investment as of June 30, 2022, was $3,090.3 million, up from $2,799.9 million as of March 31, 2022, and $2,062.4 million as of June 30, 2021[147] - The weighted average loan-to-value (LTV) for total loans originated and acquired was 69.7% for the three months ended June 30, 2022, compared to 69.2% for the previous quarter and 69.6% for the same quarter of 2021[146] - The loan portfolio was concentrated in investor 1-4 loans, representing 49.1% of the unpaid principal balance (UPB) as of June 30, 2022[162] Financial Results - The company reported pre-tax income of $14.7 million and net income of $10.6 million for the three months ended June 30, 2022[121] - Net income for the three months ended June 30, 2022, was $10.6 million, compared to $9.5 million for the same period in 2021, reflecting an increase of 12.6%[202] - Pre-tax return on equity for the quarter ended June 30, 2022 was 16.4%, significantly higher than 4.4% for the previous quarter[184] - The net interest margin for the total company increased to 3.54% for the three months ended June 30, 2022, from 1.69% for the quarter ended March 31, 2022[178] - Interest income increased by $14.3 million to $59.2 million for the three months ended June 30, 2022, compared to $44.9 million for the same period in 2021, primarily due to higher portfolio balances[203] Securitizations and Debt - The company completed three securitizations totaling $682.5 million of investor real estate loans during the quarter ended June 30, 2022[124] - The company has executed a total of twenty-three securitizations, resulting in over $4.9 billion in gross debt proceeds from May 2011 through June 2022[120] - The outstanding bond balances increased from $1,939,146,000 on December 31, 2021, to $2,527,119,000 as of June 30, 2022[242] - The company entered into a five-year $215.0 million syndicated corporate debt agreement on March 15, 2022, with a fixed interest rate of 7.125%[243] - The corporate debt average rate was reported at 7.78%, with a significant impact from one-time costs associated with debt repayment[180] Expenses and Operating Costs - Total operating expenses increased by $3.6 million to $14.3 million for the three months ended June 30, 2022, from $10.7 million for the same period in 2021, primarily driven by a $2.0 million increase in compensation and employee benefits[217] - Loan servicing expenses increased from $1.9 million for the three months ended June 30, 2021 to $3.3 million for the same period in 2022, reflecting a 73.7% increase[220] - Other operating expenses increased from $1.9 million for the three months ended June 30, 2021 to $3.2 million for the same period in 2022, a 68.4% increase[223] Liquidity and Cash Flow - Total liquidity was $134.1 million as of June 30, 2022, comprised of $46.3 million in cash and $87.8 million of available borrowings[230] - Net cash provided by operating activities for the six months ended June 30, 2022 was $13.1 million, down from $20.9 million for the same period in 2021[232] - Net cash used in investing activities for the six months ended June 30, 2022 was $507.9 million, compared to $139.6 million for the same period in 2021[234] Non-Performing Loans and Credit Losses - The company resolved $47.1 million of non-performing loans during the quarter ended June 30, 2022, compared to $58.2 million during the same quarter in 2021[156] - The allowance for loan losses increased to $4.9 million as of June 30, 2022, compared to $4.7 million as of March 31, 2022, and $4.0 million as of June 30, 2021[150] - The company’s rigorous screening and underwriting process aims to minimize actual credit losses, with borrower equity of 25% to 40% providing significant protection against credit losses[150] - The company’s active management of loans and significant equity cushion at origination are expected to continue minimizing credit losses on defaulted loans[155] Future Strategy - The company aims to resume loan originations and resolve non-performing loans as part of its future strategy[250] - The company plans to use proceeds from new securities issuance primarily for repaying warehouse borrowings and originating new investor real estate loans[242] - The company does not plan to structure any securitizations as sales or utilize off-balance-sheet vehicles[242] - The company has not maintained relationships with unconsolidated entities for off-balance-sheet arrangements[249]

Financial Data and Key Metrics Changes - Velocity Financial reported a net income of $3 million on a core basis, translating to $0.36 per share, with core EPS growth of 23% from the prior quarter [10] - The company achieved a 43% increase in portfolio-related net interest income compared to Q1 2021, resulting in a 14% return on equity (ROE) on a core earnings basis for the quarter [8][10] - The net interest margin (NIM) remained stable at 4.25%, compared to 4.27% in the previous quarter [24] Business Line Data and Key Metrics Changes - Loan production reached a record $581 million in Q1, marking a 16.8% increase sequentially and a 150% increase year-over-year [8][11][17] - The total loan portfolio grew to $2.9 billion, reflecting an 11% increase from year-end [20] - The weighted average coupon (WAC) on new applications increased to 8.1% in April, aligning with historical averages [11][19] Market Data and Key Metrics Changes - The delinquency rate continued to decline, reaching 9.8% by the end of Q1, down from a high of 17% during the pandemic [25] - The company reported a recovery rate of 104.8% on non-performing loans (NPLs), indicating successful resolutions [27] Company Strategy and Development Direction - Velocity Financial's strategy focuses on maintaining strong customer relationships while adapting to changing market conditions, which has allowed for record loan production [8][9] - The company aims to provide durable and stable earnings across various market environments, with a cautiously optimistic outlook despite rising interest rates [9][33] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by increased short-term rates and market volatility but expressed confidence in the company's ability to navigate these conditions [7][9] - The outlook remains positive, with strong demand from customers and expectations for continued growth in the loan portfolio [33] Other Important Information - The company successfully refinanced its corporate debt, lowering the coupon by approximately 200 basis points and fixing the debt for five years [12][30] - Velocity Financial completed two securitization deals in Q1 and early April, although the execution was not as strong as in previous periods [13][29] Q&A Session Summary Question: Clarification on whole loan sales gains - A participant sought clarification on the reported gains from whole loan sales, noting a discrepancy in the figures presented [38] - The CFO clarified that the reported number may have been affected by tax considerations, confirming the company operates as a C-corp [39][40] Question: Future market conditions and NIM - A participant inquired about the conditions necessary for the securitization markets to stabilize and the impact on the company's NIM [41] - Management responded that a combination of higher coupons and clearer guidance from the Federal Reserve would be essential for market recalibration [42]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to _____ Commission File Number: 001-39183 Velocity Financial, Inc. (Exact Name of Registrant as Specified in its Charter) Delaware 46-0659719 (State or ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) | ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | | --- | | For the fiscal year ended December 31, 2021 | | OR | | ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | | For the transition period from _____to _____ | | Commission File: 001-39183 | | Velocity Financial, Inc. | | (Exact Name of Registrant as Specified in Its Charter) | | ...

Velocity Financial, Inc. (NYSE:VEL) Q4 2021 Earnings Conference Call March 10, 2022 5:00 PM ET Company Participants Christopher Oltmann - Chief Accounting Officer and Director of Investor Relations Christopher Farrar - President and Chief Executive Officer Mark Szczepaniak - Chief Financial Officer Conference Call Participants Stephen Laws - Raymond James & Associates, Inc. Arren Cyganovich - Citigroup Inc. Stephen DeLaney - JMP Securities LLC Donald Fandetti - Wells Fargo Securities, LLC Operator Good day, ...

Velocity Financial, Inc. (NYSE:VEL) Q3 2021 Earnings Conference Call November 3, 2021 5:00 PM ET Company Participants Christopher Oltmann - Chief Accounting Officer and Director of IR Christopher Farrar - CEO Mark Szczepaniak - CFO Conference Call Participants Stephen Laws - Raymond James & Associates Donald Fandetti - Wells Fargo & Company Stephen DeLaney - JMP Securities Arren Cyganovich - Citigroup Inc. Operator Good day and welcome to the Velocity Financial Inc. Third Quarter 2021 Earnings Conference Ca ...

Investor 1-4 Mixed-Use Multi-Family Commercial > 3Q21 Earnings Presentation November 3, 2021 Forward-looking statements Some of the statements contained in this presentation may constitute forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, projections, plans and strategies, anticipated events or trends, and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking stateme ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Velocity Financial, Inc. (Exact Name of Registrant as Specified in its Charter) Delaware 46-0659719 (State or other jurisdiction of incorporation or organization) 30699 Russell Ranch Road ...

Velocity Financial, Inc. (NYSE:VEL) Q2 2021 Earnings Conference Call August 5, 2021 5:00 PM ET Company Participants Christopher Oltmann - Chief Accounting Officer and Director of Investor Relations Christopher Farrar - Chief Executive Officer Mark Szczepaniak - Chief Financial Officer Conference Call Participants Stephen DeLaney - JMP Securities Stephen Laws - Raymond James & Associates Arren Cyganovich - Citigroup Inc. Donald Fandetti - Wells Fargo & Company Operator Good afternoon and welcome to the Veloc ...

Investor 1-4 Mixed-Use Multi-Family Commercial > 2Q21 Earnings Presentation August 5, 2021 Forward-looking statements Some of the statements contained in this presentation may constitute forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, projections, plans and strategies, anticipated events or trends, and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statement ...