NexPoint Real Estate Finance, Inc.

INDEX TO FINANCIAL STATEMENTS

To the Stockholders and the Board of Directors

NexPoint Real Estate Finance, Inc.:

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of NexPoint Real Estate Finance, Inc. and subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Fair value measurement of certain Level 3 Investments

As discussed in Notes 2 and 5 to the consolidated financial statements, as of December 31, 2025, the Company has $49.1 million of common stock investments and $141.2 million of stock warrant investments that are measured at fair value on a quarterly basis. A portion of each of these investments uses inputs that are classified within Level 3 of the fair value hierarchy. The Company uses an income approach, a market approach, or a combination of these approaches to value each of these investments. Establishing fair values for these Level 3 investments is inherently subjective and dependent upon significant unobservable inputs and assumptions.

We identified the evaluation of the fair value measurements of certain Level 3 investments as a critical audit matter. Complex auditor judgment and the involvement of valuation professionals with specialized skills and knowledge were required to evaluate certain assumptions used in the Company’s determination of the fair value of certain Level 3 common stock and stock warrant investments. Specifically, for investments that used the income approach, the assumptions included the terminal capitalization rate, discount rate and market rent. For investments that used the market approach, the assumptions included the selection of guideline publicly traded companies and the trading multiples, and, where applicable, a discount for lack of marketability.

The following are the primary procedures we performed to address this critical audit matter. We evaluated the design of certain internal controls related to the fair value measurements process. We involved valuation professionals with specialized skills and knowledge, who assisted in:

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evaluating the terminal capitalization rate and discount rate by comparing them against ranges that were independently developed using publicly available market data for comparable properties

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assessing the appropriateness of the market rent by comparing them to comparable transactions and current listings of comparable properties

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determining the appropriateness of the guideline publicly traded companies by performing an independent search of public companies whose operations are sufficiently comparable to the subject investment based on the industry and market in which the investment operates

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determining the appropriateness of the trading multiples used by comparing them to an independently calculated range of trading multiples based on independently derived guideline publicly traded companies

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determining the appropriateness of the discount for lack of marketability by comparing to an independently calculated range for the risk-free rate and volatility observed from independently derived guideline publicly traded companies.

Allowance for credit losses on loans evaluated on a collective basis

As discussed in Notes 2 and 3 to the consolidated financial statements, the Company’s allowance for credit losses (ACL) for the loan portfolio was $34.7 million as of December 31, 2025, of which $11.7 million related to loans that share similar risk characteristics (collective ACL). Loans are rated on a scale of 1-5 based on quantitative and qualitative factors to determine whether they are to be evaluated collectively or individually. The collective ACL is evaluated using a probability of default (PD) and loss-given default (LGD) method which is applied at the loan level through the use of a third-party model. The model requires a variety of subjective assumptions, including (i) key loan-specific inputs such as loan-to-value, vintage year, loan-term, underlying property type, occupancy, geographic location, performance against the underwritten business plan, and internal loan risk rating, (ii) determination of relevant historical loan loss data sets over an observable period and (iii) selection and weighting of macroeconomic forecasts over the relevant time period. The Company focused their historical loss information on the most relevant subset of available commercial real estate (CRE) data. The Company expects to use this proxy data set, or variants of it, unless the Company develops its own sufficient history of realized losses. The Company determines its ACL based on the weighting of multiple macroeconomic forecast scenarios driven by macroeconomic variables such as gross domestic product (GDP), unemployment rate, federal funds target rate and core personal consumption expenditure (CPR) among others, during the reasonable and supportable forecast period. The reasonable and supportable forecast period is determined based on the Company’s assessment of macroeconomic forecast scenarios and plausible outcomes for the U.S. economy, current portfolio composition, level of historical loss experience, material changes in growth and credit strategy and other factors that may affect its loss experience. For the period beyond which the Company is able to make reasonable and supportable forecasts, the Company immediately reverts to the historical loss information derived from the CRE data set.

We identified the assessment of the collective ACL as a critical audit matter. A high degree of audit effort, including specialized skills and knowledge, and subjective and complex auditor judgment was involved in the assessment of the collective ACL due to significant measurement uncertainty. Specifically, the assessment encompassed the evaluation of the collective ACL methodology, including the methods and model used to estimate the PD and LGD and their significant assumptions. The significant assumptions were (1) period of historical loss information (2) composition of the proxy data set, (3) selection and weighting of macroeconomic forecast scenarios, (4) the reasonable and supportable forecast period and (5) reversion method.

The following are the primary procedures we performed to address this critical audit matter. We involved our credit risk professionals with specialized skills and knowledge, who assisted in:

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evaluating the Company’s ACL methodology for compliance with U.S. generally accepted accounting principles

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assessing the conceptual soundness of the PD and LGD model by inspecting model documentation to determine whether the model is suitable for their intended use

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assessing the composition of the proxy data set by comparing to Company and specific portfolio risk characteristics

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evaluating the selection and weighting of macroeconomic forecast scenarios used by comparing them to the Company's business environment and relevant industry practices

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evaluating the length of the period from which historical loss information was used, the reasonable and supportable forecast period, and the reversion method by comparing to specific portfolio risk characteristics and trends.

/s/ KPMG LLP

We have served as the Company’s auditor since 2019.

Dallas, Texas

March 31, 2026