Velocity Financial Posts Robust Growth and Strategic Refinancing

Velocity Financial Llc US92262D1019

Preliminary figures for Velocity Financial LLC indicate a strong close to the 2025 fiscal year, marked by significant profit growth and an improved financial foundation. The company's performance, particularly in the final quarter, signals positive momentum in both new business generation and portfolio health.

The company's unaudited results reveal substantial year-over-year gains. For the full year 2025, net income is expected to reach at least $105 million, representing a 53% increase. Total loan origination volume surged by 48% to approximately $2.7 billion.

A key indicator of financial strength is the improvement in credit quality. The proportion of non-performing loans within the portfolio has decreased to about 8.5%, down from 10.7% in the prior year.

This positive trend appears to have accelerated in the fourth quarter. Velocity Financial anticipates a net profit jump of at least 70% for the period compared to Q4 2024. On a per-share basis, diluted earnings per share (EPS) are projected to rise by a minimum of 56%. Quarterly loan originations climbed 13% to $635 million, contributing to a total unpaid principal balance (UPB) of roughly $6.5 billion by year-end.

Strategic Debt Offering Enhances Financial Flexibility

A major strategic move involved a $500 million bond issuance completed by the company's subsidiary, Velocity Commercial Capital. The senior notes, which mature in 2031, provide the capital to refinance existing secured notes carrying a 7.125% interest rate that were originally due in 2027.

This refinancing initiative is designed to optimize interest expenses and extend the maturity profile of the company's debt. Proceeds beyond those used for the early redemption are allocated for general corporate purposes. Notably, Velocity Financial has earmarked up to $75 million of these funds for a potential acquisition currently under evaluation.

Final Audited Results and Outlook Forthcoming

Investors can expect a comprehensive review of the audited financial statements after the US market closes on Wednesday, March 11, 2026. Management will host a conference call following the release to discuss the final numbers in detail. Additional information regarding the potential acquisition and operational targets for the new fiscal year is also scheduled to be addressed during that call.

The concurrent growth in lending volume and improvement in asset quality underscores the company's resilient risk management framework, even within a dynamic real estate market.