Ellington Financial Inc.
For the period ended Sep 30, 2025. Filed Nov 10, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 10, 2025
EFC$11.26-2.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-11.
0001411342-25-000077
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-10.
0001628280-25-051038
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 390 previous paragraphs and 394 current paragraphs.
223 unchanged; 140 reworded; 30 added; 24 removed; 3 previous and 1 current paragraphs rearranged.
Tables are not compared: 42 previous and 42 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (30)
Current report
Longbridge also originates HELOCs designed for homeowners aged 62 or older. These loans are typically interest only, first or second lien loans that do not require principal payments as long as the borrower remains in compliance with specific terms of the loan such as related to owner-occupancy, payment of property taxes, and keeping insurance coverage and interest payments current. They differ from traditional HELOCs in that the principal is deferred until the borrower dies, sells the home, or becomes delinquent on property taxes or homeowners insurance.
Current report
We also acquire residential mortgage loans that have been originated in compliance with U.S government Agency or government-sponsored enterprise ("GSE") guidelines that are eligible for sale to or securitization by the GSEs ("Agency-eligible residential mortgage loans"). Such loans may be collateralized by owner-occupied or non-owner occupied properties.
Current report
Reverse Mortgage Loans, Reverse MSRs
Current report
•The U.S. Federal Reserve (the "Federal Reserve") maintained the target range for the federal funds rate at 4.25%–4.50% at its July meeting. However, at its September meeting, the Federal Reserve cut rates for the first time in 2025, reducing the target range by 25 basis points to 4.00%–4.25%, with one member preferring a larger 50 basis point rate cut. In its September announcement, the Federal Reserve noted: “In considering additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks.”
Current report
•In the third quarter, the Federal Reserve continued to reinvest only principal payments that exceeded $35 billion on Agency RMBS and $5 billion on U.S. Treasury securities.
Current report
Government Shutdown
Current report
•A partial U.S. government shutdown began on October 1, 2025, following a lapse in federal appropriations due to disagreements over spending levels. Essential government functions continued to operate, but many agencies temporarily furloughed employees. The shutdown contributed to short-term uncertainty in financial markets and weighed modestly on near-term economic sentiment.
Current report
•In the third quarter, the U.S. administration continued to amend the broad-based tariffs announced in early April and introduced additional tariffs affecting various countries and industries. Several trading partners, including the United Kingdom, the European Union, Japan, South Korea, and others, reportedly reached agreements with the U.S. to reduce tariff levels, although many details of these trade agreements have not yet been implemented. The administration also extended the pause on higher tariffs for Chinese imports, leaving the reduced minimum tariff rate in place.
Current report
•Interest rates trended lower in the third quarter as expectations for potential additional Federal Reserve rate cuts, a weakening labor market, and the looming threat of a government shutdown put downward pressure on yields despite a modest rise in inflation. The yield on the 2-year U.S. Treasury security traded within a 47-basis point range before ending the quarter down 11 basis points at 3.61%. The yield on the 10-year U.S. Treasury traded within a similar range before ending the quarter down 8 basis points at 4.15%.
Current report
•Interest rate volatility, as measured by the MOVE Index, declined quarter over quarter and reached its lowest level since December 2021 in mid-September.
Current report
•The Mortgage Bankers Association’s Refinance Index remained relatively low for most of the third quarter before spiking near quarter end and reaching its highest level since March 2022, ending up 68% quarter over quarter.
Current report
•The U.S. government shutdown delayed key data releases, including the third-quarter U.S. real GDP estimate and September unemployment. U.S. real GDP contracted by an estimated annualized rate of 0.6% in the first quarter before expanding by an estimated annualized rate of 3.8% in the second quarter. Meanwhile, the unemployment rate increased moderately during the first two months of the third quarter registering 4.2% in July and 4.3% in August.
Current report
•Equity volatility was relatively low throughout the third quarter.
Current report
(4)Other residential mortgage loans include Agency-eligible mortgage loans and secondary market purchases of non-performing and re-performing mortgage loans.
Current report
(11)Includes loan to an entity which purchases residential mortgage loans for eventual securitization.
Current report
(1)Other residential mortgage loans include Agency-eligible mortgage loans and secondary market purchases of non-performing and re-performing mortgage loans.
Current report
(2)REO is not considered a financial instrument and, as a result, is included at the lower of cost or fair value, as discussed in Note 2 of the notes to condensed consolidated financial statements.
Current report
Net gains on our Agency RMBS and interest rate hedges drove the strong results in our Agency strategy. Interest rates and interest rate volatility declined in the quarter, while Agency yield spreads tightened, all of which were supportive of our portfolio.
Current report
(3)REO is not considered a financial instrument and, as a result, is included at the lower of cost or fair value, as discussed in Note 2 of the notes to condensed consolidated financial statements.
Current report
(3)Other residential mortgage loans include Agency-eligible and secondary market purchases of non-performing and re-performing mortgage loans.
Current report
(9)Includes loan to an entity which purchases residential mortgage loans for eventual securitization.
Current report
Other operating expenses in our investment portfolio segment were $1.8 million and $1.4 million for the three-month periods ended September 30, 2025 and 2024, respectively.
Current report
For the three-month period ended September 30, 2025, other income (loss) was $(2.1) million, consisting primarily of net unrealized losses of $(8.6) million on our Other secured borrowings, at fair value, net realized and unrealized losses of $(7.2) million on our financial derivatives, $(2.6) million on real estate owned, net, and $(5.2) million on Other, net. These losses were partially offset by net realized and unrealized gains of $21.6 million on our securities and loans. Net realized and unrealized gains of $21.6 million on our securities and loans were primarily on non-QM loans, Agency RMBS, residential transition loans, and other ABS. Net realized and unrealized losses of $(7.2) million on our financial derivatives were primarily related to net realized and unrealized losses, driven by lower interest rates, on our interest rate swaps, and to a lesser extent, our TBAs. Other, net of $(5.2) million consists primarily of net realized and unrealized losses on our Forward MSR-related investments, various origination and loan income, rental income, realized gains on foreign currency transactions, and unrealized losses on foreign currency remeasurement. We recognized net unrealized losses of $(8.6) million on our Other secured borrowings, at fair value for the quarter ended September 30, 2025, related to borrowings on our securitized non-QM loans. These securitized non-QM loans had net unrealized gains of $5.6 million, which are included in Unrealized gains (losses) on securities and loans, net.
Current report
For the three-month period ended September 30, 2024, other income (loss) was $6.5 million, consisting primarily of net realized and unrealized gains of $98.5 million on our securities and loans, partially offset by net realized and unrealized losses of $(58.0) million on our Other secured borrowings, at fair value, $(31.0) million on our financial derivatives, $(1.8) million of Other, net, and $(1.2) million on real estate owned, net. Net realized and unrealized gains of $98.5 million on our securities and loans were primarily on non-QM loans, non-Agency RMBS, closed-end second lien loans, and non-Agency CMBS, all primarily driven by lower interest rates. These gains were partially offset by net realized and unrealized losses on commercial mortgage bridge loans and consumer loans. We recognized net unrealized losses of $(58.0) million on our Other secured borrowings, at fair value for the three-month period ended September 30, 2024, related to borrowings on our securitized non-QM loans. These securitized non-QM loans had net unrealized gains of $62.5 million, which are included in Unrealized gains (losses) on securities and loans, net. Net realized and unrealized losses of $(31.0) million on our financial derivatives were primarily related to net realized and unrealized losses, driven by lower interest rates, on our interest rate swaps, and to a lesser extent, on our TBAs and on our short positions in U.S. Treasury futures. Other, net of $(1.8) million consisted primarily of net realized and unrealized losses on our Forward MSR-related investments, partially offset by various origination and loan income, and rental income.
Current report
For the three-month period ended September 30, 2024, other income (loss) from the Longbridge segment was $30.6 million, consisting primarily of gains from Net change from HECM reverse mortgage loans, at fair value of $158.6 million, net realized and unrealized gains of $16.1 million on securities and loans, other income of $3.4 million, and net unrealized gains of $1.9 million on Other Secured borrowings, at fair value. These gains were partially offset by Net change related to HMBS obligations, at fair value of $(133.8) million and net realized and unrealized losses of $(15.5) million on financial derivatives. Gains from Net change from HECM reverse mortgage loans at fair value of $158.6 million primarily consisted of $149.2 million of coupon income on HECM loans and net realized and unrealized gains of $10.3 million on HECM loans. The net realized and unrealized gains on HECM loans were primarily driven by a decline in interest rate quarter over quarter. Losses from Net change related to HMBS obligations, at fair value of $(133.8) million primarily consisted of $(140.4) million of interest expense on the HMBS obligations and net unrealized gains of $6.5 million on the HMBS obligations, which partially offset the interest income on HECM loans and net realized and unrealized gains on HECM loans. Net gains of $16.1 million on securities and loans were primarily driven by tighter yield spreads on proprietary reverse mortgage loans. Other income, included in Other, net of $3.4 million, is primarily related to $2.1 million of servicing fees and $2.5 million of origination fees, partially offset by net realized and unrealized losses of $(0.7) million on MSRs.
Current report
Income tax expense (benefit) was $1.1 million for the three-month period ended September 30, 2025, as compared to $12 thousand for the three-month period ended September 30, 2024.
Current report
For the three-month period ended September 30, 2024, Earnings (losses) from investments in unconsolidated entities of $7.3 million primarily consisted of net realized and unrealized gains on investments in loan originators, investments in entities holding commercial mortgage loans and REO, in which we co-invest with other Ellington affiliates, and investments in risk retention vehicles related to non-QM securitizations
Current report
The table below summarizes the components of interest expense in the Longbridge segment for the nine-month periods ended September 30, 2025 and 2024.
Current report
For the nine-month period ended September 30, 2024, other income (loss) was $44.2 million, consisting primarily of net realized and unrealized gains of $110.8 million on our securities and loans, $5.8 million on our financial derivatives, and $3.5 million of Other, net. These gains were partially offset by net unrealized losses of $(71.7) million on our Other secured borrowings, at fair value, and net realized and unrealized losses of $(4.2) million on real estate owned, net. Net realized and unrealized gains of $110.8 million on our securities and loans were primarily on non-QM loans and Agency and non-Agency RMBS, primarily due to a combination of lower interest rates and yield spread tightening. These gains were partially offset by net realized and unrealized losses on residential transition loans and consumer loans. Net realized and unrealized gains of $5.8 million on our financial derivatives were primarily related to net realized and unrealized gains on our interest rate swaps, and to a lesser extent, on our TBAs, driven by higher interest rates during the first half of the year. These net gains on our financial derivatives for the first half of 2024 were partially offset by net losses in the third quarter, driven by declining interest rates during that quarter. Other, net of $3.5 million consisted primarily of origination and loan income, rental income, and income and net realized and unrealized gains on our Forward MSR-related investment. We recognized net unrealized losses of $(71.7) million on our Other secured borrowings, at fair value for the nine-month period ended September 30, 2024, related to borrowings on our securitized non-QM loans. These securitized non-QM loans had net unrealized gains of $79.4 million, which are included in Unrealized gains (losses) on securities and loans, net.
Current report
For the nine-month period ended September 30, 2024, other income (loss) from the Longbridge segment was $98.7 million, consisting primarily of gains from Net change from HECM reverse mortgage loans, at fair value of $510.8 million, $13.2 million of Other, net, net gains of $9.5 million on securities and loans, net gains of $3.1 million on financial derivatives, and net gains of $1.5 million on Other secured borrowings, at fair value. These gains were partially offset by Net change related to HMBS obligations, at fair value of $(439.5) million. Net change from HECM reverse mortgage loans at fair value of $510.8 million primarily consisted of $432.8 million of coupon income on HECM loans and net realized and unrealized gains of $85.0 million on HECM loans. The net realized and unrealized gains on the HECM loans were primarily driven by tighter yield spreads of HECM loans. Net change related to HMBS obligations, at fair value of $(439.5) million primarily consisted of $(407.3) million of interest expense on the HMBS obligations and net unrealized losses of $(32.2) million on the HMBS obligations, which partially offset the interest income and net realized and unrealized gains on HECM loans. Other income, included in Other, net of $13.2 million, is primarily related to $6.7 million of origination fees and $6.4 million of servicing fees. Net gains of $9.5 million on securities and loans were primarily driven by tighter yield spreads of proprietary reverse mortgage loans. .
Removed paragraphs (24)
Previous report
•The U.S. Federal Reserve (the "Federal Reserve") maintained the target range for the federal funds rate at 4.25%–4.50% at both its May and June 2025 meetings. After noting that economic uncertainty had increased further at its May meeting, the Federal Reserve’s June announcement noted that “uncertainty about the economic outlook has diminished but remains somewhat elevated.”
Previous report
•As announced at its March meeting, the Federal Reserve further reduced the pace of its balance sheet contraction in April by lowering the cap on portfolio runoff of U.S. Treasury securities from $25 billion to $5 billion, while maintaining the $35 billion cap on Agency RMBS runoff.
Previous report
•In early April, the U.S. administration announced its plans for broad-based tariffs. These announcements caused uncertainty in financial markets, contributing to heightened volatility and notable declines in major equity indices and widening of credit spreads in early April. However, financial markets recovered after a 90-day pause on most tariffs was announced on April 9th, except for tariffs on Chinese imports. Then in mid-May, the U.S. and China mutually agreed to reduce the minimum tariff rates on bilateral imports. By the end of the second quarter, multiple major equity indices had reached all-time highs.
Previous report
•Interest rates were relatively volatile in the second quarter in response to economic uncertainty and evolving expectations around the path of monetary policy. The yield on the 2-year U.S. Treasury security traded within a 45-basis point range before ending the quarter down 16 basis points to 3.72%. The yield on the 10-year U.S. Treasury security traded within a 60-basis point range before ending the second quarter up just 2 basis points to 4.23%. Meanwhile, interest rate volatility, as measured by the MOVE Index, spiked in the early part of the quarter amid increased tariff uncertainty, before reversing course and finishing the quarter lower overall.
Previous report
•The Mortgage Bankers Association’s Refinance Index, while still low by historical standards, rose by 6.9% quarter over quarter.
Previous report
•U.S. real GDP expanded at an estimated annualized rate of 3.0% in the second quarter, after contracting by 0.5% in the prior quarter. Meanwhile, unemployment remained steady at 4.2% in both April and May, before falling slightly to 4.1% in June.
Previous report
•Equity volatility spiked in early April, with the VIX reaching its highest level since the COVID-related highs of 2020, before reversing course and ending the quarter lower overall.
Previous report
(2) Conformed to current period presentation.
Previous report
(11)We participate in the economic returns of a portfolio of forward MSRs under various agreements with a licensed mortgage servicer holding such MSRs. Under such agreements, we can direct the servicer to finance the MSRs and distribute the proceeds of such financings to us. Forward MSR-related investments, at fair value are presented on our Condensed Consolidated Balance Sheet net of any such financing; as of both June 30, 2025 and March 31, 2025, such borrowings were $93.5 million.
Previous report
(1)REO is not considered a financial instrument and, as a result, is included at the lower of cost or fair value, as discussed in Note 2 of the notes to condensed consolidated financial statements.
Previous report
Agency RMBS yield spreads widened in early April, driven in part by increased volatility due to tariff-related uncertainty. Yield spreads reversed course in May and June, tightening meaningfully, but still ended the quarter wider overall. Overall, we had a net loss in our Agency strategy for the quarter, driven by net losses on interest rate hedges.
Previous report
(1)As of June 30, 2025 and March 31, 2025, excludes borrowings at certain unconsolidated entities that are recourse to us. Including such borrowings, our debt-to-equity ratio based on total recourse borrowings was 1.9:1 and 2.1:1 as of June 30, 2025 and March 31, 2025, respectively.
Previous report
a securitization of proprietary reverse mortgage loans during the three-month period ended June 30, 2025, and an increase in servicing and various loan origination expenses resulting from our larger holdings and originations of reverse mortgage loans.
Previous report
Other operating expenses in our investment portfolio segment were $2.0 million for both of the three-month periods ended June 30, 2025 and 2024, respectively.
Previous report
For the three-month period ended June 30, 2025, other income (loss) was $7.0 million, consisting primarily of net realized and unrealized gains of $47.3 million on our securities and loans and $3.4 million of Other, net. These gains were partially offset by net unrealized losses of $(17.1) million on our Other secured borrowings, at fair value, $(23.4) million on our financial derivatives, and $(3.2) million on real estate owned, net. Net realized and unrealized gains of $47.3 million on our securities and loans were primarily on non-QM loans and retained tranches, Agency and non-Agency RMBS, closed-end second lien loans, HELOC loans, and other ABS. Net realized and unrealized losses of $(23.4) million on our financial derivatives were primarily related to net realized and unrealized losses on our credit hedges and interest rate swaps. The net loss on our interest rate swaps was driven by the decline in interest rates during the second quarter. Other, net of $3.4 million consists primarily of realized gains on foreign currency transactions, unrealized gains on foreign currency remeasurement, various origination and loan income, and rental income. We recognized net unrealized losses of $(17.1) million on our Other secured borrowings, at fair value for the quarter ended June 30, 2025, related to borrowings on our securitized non-QM loans. These securitized non-QM loans had net unrealized gains of $26.9 million, which are included in Unrealized gains (losses) on securities and loans, net.
Previous report
For the three-month period ended June 30, 2024, other income (loss) was $27.6 million, consisting primarily of net realized and unrealized gains of $14.5 million on our securities and loans, $12.5 million on our financial derivatives, and $2.6 million of Other, net. These gains were partially offset by net unrealized losses of $(1.0) million on real estate owned, net and $(1.0) million on our Other secured borrowings, at fair value. Net realized and unrealized gains of $14.5 million on our securities and loans were primarily on non-QM loans, commercial mortgage loans, and non-Agency RMBS. These gains were partially offset by net realized and unrealized losses on non-Agency CMBS and Agency RMBS. Net realized and unrealized gains of $12.5 million on our financial derivatives were primarily related to net realized and unrealized gains, driven by higher interest rates, on our interest rate swaps, and to a lesser extent, our TBAs and our short positions in U.S. Treasury futures. Other, net of $2.6 million consisted primarily of various origination and loan income, rental income, and income and net realized and unrealized gains on our Forward MSR-related investment. We recognized net unrealized losses of $(1.0) million on our Other secured borrowings, at fair value for the three-month period ended June 30, 2024, related to borrowings on our securitized non-QM loans. These securitized non-QM loans had net unrealized gains of $6.0 million, which are included in Unrealized gains (losses) on securities and loans, net.
Previous report
For the three-month period ended June 30, 2025, other income (loss) from the Longbridge segment was $44.0 million, consisting primarily of gains from Net change from HECM reverse mortgage loans, at fair value of $168.8 million, net gains of
Previous report
For the three-month period ended June 30, 2024, other income (loss) from the Longbridge segment was $29.9 million, consisting primarily of gains from Net change from HECM reverse mortgage loans, at fair value of $146.7 million, other income of $5.1 million, net realized and unrealized gains of $3.5 million on financial derivatives and $2.8 million on securities and loans. These gains were partially offset by Net change related to HMBS obligations, at fair value of $(127.7) million and net unrealized losses of $(0.5) million on Other Secured borrowings, at fair value. Gains from Net change from HECM reverse mortgage loans at fair value of $146.7 million primarily consisted of interest income on HECM loans of $144.9 million, net realized and unrealized gains on HECM loans of $8.5 million, and net realized and unrealized losses on the HMBS MSR Equivalent of $(6.7) million. The net realized and unrealized gains on the HECM loans were primarily driven by tighter yield spreads on seasoned HECM loans quarter over quarter. The losses on HMBS MSR Equivalent were driven by higher interest rates and runoff during the quarter. Other income, included in Other, net of $5.1 million, is primarily related to servicing fees of $2.0 million, origination fees of $2.2 million, and a net gain of $1.7 million on loan commitments, which is partially offset by net realized and unrealized losses on MSRs of $(0.4) million. Losses from Net change related to HMBS obligations, at fair value of $(127.7) million primarily consisted of interest expense on the HMBS obligations of $(136.4) million and net unrealized gains on the HMBS obligations of $8.8 million, which partially offset the interest income on HECM loans and net realized and unrealized gains on HECM loans.
Previous report
Income tax expense (benefit) was $1.5 million for the three-month period ended June 30, 2025, as compared to $0.1 million for the three-month period ended June 30, 2024.
Previous report
For the three-month period ended June 30, 2024, Earnings (losses) from investments in unconsolidated entities of $12.0 million primarily consisted of realized and unrealized gains on investments in loan originators and investments in entities holding commercial mortgage loans and REO, in which we co-invest with other Ellington affiliates, partially offset by unrealized losses on investments in unconsolidated entities related to risk retention related vehicles related to non-QM securitizations.
Previous report
The table below summarizes the components of interest expense in the Longbridge segment for the six-month periods ended June 30, 2025 and 2024.
Previous report
For the six-month period ended June 30, 2024, other income (loss) was $37.6 million, consisting primarily of net realized and unrealized gains of $36.7 million on our financial derivatives, $12.3 million on our securities and loans, and $5.3 million of Other, net. These gains were partially offset by net unrealized losses of $(13.7) million on our Other secured borrowings, at fair value, and net realized and unrealized losses of $(3.0) million on real estate owned, net. Net realized and unrealized gains of $36.7 million on our financial derivatives were primarily related to net realized and unrealized gains, driven by higher interest rates, on our interest rate swaps, and to a lesser extent, our TBAs and U.S. Treasury futures. Net realized and unrealized gains of $12.3 million on our securities and loans were primarily on non-QM loans, commercial mortgage loans, and non-Agency RMBS. These gains were partially offset by net realized and unrealized losses on Agency RMBS and residential transition loans. Other, net of $5.3 million consisted primarily of various origination and loan income, rental income, and income and net realized and unrealized gains on our Forward MSR-related investment. We recognized net unrealized losses of $(13.7) million on our Other secured borrowings, at fair value for the three-month period ended June 30, 2024, related to borrowings on our securitized non-QM loans. These securitized non-QM loans had net unrealized gains of $16.9 million, which are included in Unrealized gains (losses) on securities and loans, net.
Previous report
For the six-month period ended June 30, 2024, other income (loss) from the Longbridge segment was $68.0 million, consisting primarily of gains from Net change from HECM reverse mortgage loans, at fair value of $352.2 million, net gains of $18.6 million on financial derivatives, and other income of $9.8 million. These gains were partially offset by Net change related to HMBS obligations, at fair value of $(305.7) million and net unrealized losses of $(6.6) million on securities and loans. Gains from Net change from HECM reverse mortgage loans at fair value of $352.2 million primarily consisted of interest income on HECM loans of $283.5 million and net realized and unrealized gains on HECM loans $74.6 million, which is partially offset by net realized and unrealized losses on the HMBS MSR Equivalent of $(6.0) million. The net realized and unrealized gains on the HECM loans were primarily driven by tighter yield spreads of seasoned HECM loans. Losses on HMBS MSR Equivalent were primarily driven by portfolio runoff and higher interest rates. Other income, included in Other, net of $9.8 million, is primarily related to servicing fees of $4.1 million, origination fees of $4.2 million, and a net gain on loan commitments $3.0 million. Losses from Net change related to HMBS obligations, at fair value of $(305.7) million primarily consisted of interest expense on the HMBS obligations of $(266.9) million and net unrealized losses on the HMBS obligations of $(38.7) million, which partially offset the interest income and net realized and unrealized gains on HECM loans.
Previous report
(1)Average borrowings outstanding have been updated in the current period to correct for prior quarter.
Reworded paragraphs (140)
Previous wording
Our commercial mortgage loans may be fixed or floating rate and will generally have maturities ranging from one to ten years. We typically originate and acquire first-lien loans but may also originate and acquire subordinated loans. As of June 30, 2025, all of our commercial mortgage loans were first-lien loans. Commercial real estate debt typically limits the borrower's right to freely prepay for a period of time through provisions such as prepayment fees, lockout, yield maintenance, or defeasance provisions.
Current wording
Our commercial mortgage loans may be fixed or floating rate and will generally have maturities ranging from one to two years. We typically originate and acquire first-lien loans but may also originate and acquire subordinated loans. As of September 30, 2025, all of our commercial mortgage loans were first-lien loans. Commercial real estate debt typically limits the borrower's right to freely prepay for a period of time through provisions such as prepayment fees, lockout, yield maintenance, or defeasance provisions.
Previous wording
The majority of Longbridge's existing MSRs relate to HECM loans that Longbridge pooled and securitized into HMBS and then sold into the secondary market with servicing rights retained. In accordance with U.S. GAAP, so long as Longbridge retains such mortgage servicing rights and the obligations relating thereto, such HECM loans do not meet the requirement for sale accounting in accordance with US GAAP and remain on Longbridge's balance sheet. The sold HMBS securities are accounted for as secured borrowings. In addition, Longbridge opportunistically acquires, in the secondary market or otherwise, MSRs associated with either proprietary reverse mortgage loans, HECMs or HECM buyout loans.
Current wording
The majority of Longbridge's existing MSRs relate to HECM loans that Longbridge pooled and securitized into HMBS and then sold into the secondary market with servicing rights retained. In accordance with U.S. GAAP, so long as Longbridge retains such mortgage servicing rights and the obligations relating thereto, such HECM loans do not meet the requirement for sale accounting and remain on Longbridge's balance sheet. The sold HMBS securities are accounted for as secured borrowings. In addition, Longbridge opportunistically acquires, in the secondary market or otherwise, MSRs associated with either proprietary reverse mortgage loans, HECMs or HECM buyout loans.
Previous wording
•Mortgage rates increased quarter over quarter with the Freddie Mac survey 30-year mortgage rate increasing from 6.65% as of March 27th to 6.77% as of June 26th.
Current wording
•Mortgage rates also declined, with the Freddie Mac survey 30-year mortgage rate falling from 6.77% on June 26th to 6.30% on September 25th.
Previous wording
•Secured Overnight Financing Rates (“SOFR”) were generally unchanged quarter over quarter. The one-month SOFR rate remained at 4.32%, while the three-month SOFR rate remained at 4.29%. SOFR rates drive many of our financing costs.
Current wording
•Secured Overnight Financing Rates (“SOFR”) declined quarter over quarter. The one-month SOFR rate fell 19 basis points to 4.13%, while the three-month SOFR rate decreased 32 basis points to 3.98%. SOFR rates drive many of our financing costs.
Previous wording
•Following a 3.9% increase in 2024, the S&P CoreLogic Case-Shiller US National Home Price NSA Index rose by 2.4% over the first five months of 2025. Meanwhile, the National Association of Realtors Housing Affordability Index declined by 3.7% during the first five months of 2025, as higher mortgage rates and elevated home prices stressed housing affordability.
Current wording
•The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index rose by 2.1% year to date through August. Meanwhile, the National Association of Realtors Housing Affordability Index increased by 3.5% year to date through September.
Previous wording
•Mortgage prepayment speeds also remained low overall, with Fannie Mae 30-year MBS registering CPRs of 7.4 in both April and May and 7.2 in June.
Current wording
•Mortgage prepayment speeds remained low with the Fannie Mae 30-year MBS registering CPRs of 7.4, 7.3, and 7.9, in July, August, and September, respectively.
Previous wording
•Inflation, as measured by the 12-month change in the Consumer Price Index for All Urban Consumers (“CPI-U"), not seasonally adjusted, increased in the second quarter, registering 2.3% in April, 2.4% in May, and 2.7% in June 2025. This compares to 12-month changes of 3.0% in January, 2.8% in February, and 2.4% in March 2025.
Current wording
•Inflation, as measured by the 12-month change in the Consumer Price Index for All Urban Consumers ("CPI-U"), not seasonally adjusted, increased during the quarter, registering 2.7% July, 2.9% August, and 3.0% in September. This compares to the 12-month changes of 2.3% in April, 2.4% in May, and 2.7% in June 2025.
Previous wording
•For the second quarter, the Bloomberg U.S. MBS Index posted a return of 1.17% and an excess return (on a duration-adjusted basis) of 0.18% relative to the Bloomberg U.S. Treasury Index.
Current wording
•For the third quarter, the Bloomberg U.S. MBS Index posted a return of 2.53% and an excess return (on a duration-adjusted basis) of 0.86% relative to the Bloomberg U.S. Treasury Index.
Previous wording
•The Bloomberg U.S. Corporate Bond Index generated a return of 1.87% and an excess return of 1.06% for the quarter, while the Bloomberg U.S. Corporate High Yield Bond Index generated a return of 3.56% and an excess return of 2.17%. Corporate credit spreads tightened during the quarter, with spreads on the Markit CDX North America Investment Grade and High Yield Indices decreasing by 58 and 10 basis points quarter-over-quarter, respectively.
Current wording
•The Bloomberg U.S. Corporate Bond Index generated a return of 2.70% and an excess return of 1.02% for the quarter, while the Bloomberg U.S. Corporate High Yield Bond Index generated a return of 2.65% and an excess return of 1.36%. Corporate credit spreads were tighter quarter over quarter, with spreads on the Markit CDX North America Investment Grade and High Yield Indices falling by 3 and 17 basis points, respectively.
Previous wording
•After sharp declines in early April driven largely by fears around trade policy, U.S. equity markets rallied to generate excellent performance in the second quarter. Overall, the NASDAQ rose by 17.7%, the S&P 500 rose by 10.6%, and the Dow Jones Industrial Average rose by 5.0%, with both the NASDAQ and S&P 500 finishing the quarter at all-time highs. Meanwhile, London's FTSE 100 index rose by 2.1%, while the MSCI World global equity index increased by 11.0%.
Current wording
•U.S. equity markets rose steadily during the third quarter, with several major indices hitting record highs. Overall, the NASDAQ rose by 11.2%, the S&P 500 rose by 7.8%, and the Dow Jones Industrial Average rose by 5.2%. Meanwhile, London's FTSE 100 index rose by 6.7%, while the MSCI World global equity index increased by 7.0%.
Previous wording
(3)Also includes related REO. In accordance with U.S. GAAP, REO is not considered a financial instrument and, as a result, is included at the lower of cost or fair value, as discussed in Note 2 of the notes to consolidated financial statements.
Current wording
(3)Includes related REO. In accordance with U.S. GAAP, REO is not considered a financial instrument and, as a result, is included at the lower of cost or fair value, as discussed in Note 2 of the notes to consolidated financial statements.
Previous wording
(4)Includes investments in unconsolidated entities holding commercial mortgage loans and REO and corporate loans secured by commercial mortgage loans.
Current wording
(5)Includes equity investments in unconsolidated entities holding commercial mortgage loans and REO and corporate loans secured by commercial mortgage loans.
Previous wording
(5)Also includes equity investments in securitization-related vehicles.
Current wording
(6)Includes equity investments in securitization-related vehicles.
Previous wording
(8)Includes corporate loans to certain loan origination entities in which we hold an equity investment.
Current wording
(7)Includes corporate loans to certain loan origination entities in which we hold an equity investment.
Previous wording
(7)Retained RMBS represents RMBS issued by non-consolidated Ellington-sponsored loan securitization trusts, and interests in entities holding such RMBS.
Current wording
(8)Retained RMBS represents RMBS issued by non-consolidated Ellington-sponsored loan securitization trusts, and interests in entities holding such RMBS.
Previous wording
(6)Includes equity investment in Ellington affiliate.
Current wording
(9)Includes equity investment in Ellington affiliate.
Previous wording
(9)Includes equity investment in an unconsolidated entity which purchases certain other loans for eventual securitization.
Current wording
(10)Includes equity investment in an unconsolidated entity which purchases certain other loans for eventual securitization.
Previous wording
(10)Includes an investment in an unconsolidated entity holding European RMBS.
Current wording
(12)Includes investment in an unconsolidated entity holding European RMBS.
Previous wording
Our total adjusted long credit portfolio increased by 1% to $3.32 billion as of June 30, 2025, compared to $3.30 billion as of March 31, 2025. Our portfolios of commercial mortgage bridge loans, non-QM loans, and non-Agency RMBS all expanded, driven by net purchases. These increases were largely offset by the impact of securitizations, tactical sales of HELOC and non-QM loans, and a smaller residential transition loan portfolio, with principal paydowns in that portfolio exceeding new purchases.
Current wording
Our total adjusted long credit portfolio increased by 11% to $3.56 billion as of September 30, 2025, compared to $3.22 billion as of June 30, 2025. The increase was driven by net purchases of non-QM loans, commercial mortgage bridge loans, other residential mortgage loans, and CLOs; and a larger portfolio of retained non-QM RMBS. These increases were partially offset by the impact of loans sold into securitizations, net sales of non-Agency RMBS, and a smaller residential transition loan portfolio, with principal paydowns in that portfolio exceeding new purchases.
Previous wording
Higher net interest income and net realized and unrealized gains from non-QM loans and retained tranches, closed-end second lien loans and retained tranches, and other loans and ABS drove positive performance in our credit portfolio during the quarter. We also benefited from positive results from our equity investments in loan originators. Partially offsetting the higher net interest income were net unrealized losses on forward MSR-related investments, as well as losses on commercial and residential REO.
Current wording
Overall positive performance was driven by higher net interest income in the credit portfolio, and net realized and unrealized gains from residential transition loans and other loans and ABS. We also benefitted from strong credit performance across our loan businesses and positive results from our equity investments in loan originators. Partially offsetting higher net interest income were net realized and unrealized losses on non-QM retained tranches, CLOs, forward MSR-related investments, and residential REO.
Previous wording
The percentage of delinquent loans in our residential mortgage loan portfolio and commercial mortgage loan portfolio (including loans accounted for as equity method investments) increased during the quarter. Both our residential and commercial mortgage loan portfolios continue to experience low levels of realized credit losses and strong overall credit performance, though we continue to work out a few non-performing commercial assets. We successfully resolved one of these non-performing commercial assets during the quarter, and now have only one significant workout remaining.
Current wording
The percentage of delinquent loans in our residential mortgage loan portfolio decreased quarter over quarter, while the percentage of delinquent loans in our commercial mortgage loan portfolio (including loans accounted for as equity method investments) increased during the quarter. Both of these portfolios continue to experience low levels of realized credit losses and strong overall credit performance, though we continue to work out several non-performing assets.
Previous wording
During the quarter, the net interest margin on our credit portfolio increased to 3.11% from 2.90%, primarily driven by a lower cost of funds. We continued to benefit from positive carry on our interest rate swap hedges, where we overall receive a higher floating rate and pay a lower fixed rate.
Current wording
During the quarter, the net interest margin on our credit portfolio increased to 3.65% from 3.11%, driven by an increase in asset yields and a lower cost of funds. We continued to benefit from positive carry on our interest rate swap hedges, where we overall receive a higher floating rate and pay a lower fixed rate.
Previous wording
(1)Excludes commercial mortgage loans in non-accrual status, with a fair value of $58.5 million.
Current wording
(1)Excludes commercial mortgage loans in non-accrual status, with a fair value of $103.7 million.
Previous wording
As of June 30, 2025, we held two commercial REO properties with a fair value of $17.3 million. Additionally, as of June 30, 2025, an unconsolidated variable interest entity in which we co-invest with other Ellington affiliates held a commercial REO property; the fair value of our allocable portion of such REO was approximately $36.9 million.
Current wording
As of September 30, 2025, we held two commercial REO properties with a fair value of $17.5 million. Additionally, as of September 30, 2025, an unconsolidated variable interest entity in which we co-invest with other Ellington affiliates held a commercial REO property; the fair value of our allocable portion of such REO was approximately $39.1 million.
Previous wording
(1)Excludes the assets of the European Mortgage Loan Securitization (see Note 13, Securitization Transactions—Residential Mortgage Loan Securitizations—European Residential Mortgage Loans), which is a consolidated VIE holding non-performing residential mortgage loans with an unpaid principal balance and fair value of $20.8 million and $19.3 million, respectively. The net fair value of the interest held by us in this VIE was $65 thousand.
Current wording
(1)Excludes the assets of the European Mortgage Loan Securitization (see Note 13, Securitization Transactions—Residential Mortgage Loan Securitizations—European Residential Mortgage Loans), which is a consolidated VIE holding non-performing residential mortgage loans with an unpaid principal balance and fair value of $20.7 million and $15.3 million, respectively. The net fair value of the interest held by us in this VIE was $64 thousand.
Previous wording
As discussed in Note 16 of the notes to our condensed consolidated financial statements, we, through a wholly-owned trust subsidiary, purchase automobile loans under agreements with a consumer loan originator. We have beneficial interests in the loan cash flows, which are net of servicing-related fees and expenses including a deferred performance-based fee to the consumer loan originator, in which we have a non-controlling equity interest. The total fair value of these investments, which are included in Securities, at fair value on the Condensed Consolidated Balance Sheet, was $54.6 million as of June 30, 2025. The table below provides additional information about the automobile loans underlying these participation certificates, which comprise our investments in ABS backed by consumer loans, as of June 30, 2025:
Current wording
As discussed in Note 16 of the notes to our condensed consolidated financial statements, we, through a wholly-owned trust subsidiary, purchase automobile loans under agreements with a consumer loan originator. We have beneficial interests in the loan cash flows, which are net of servicing-related fees and expenses including a deferred performance-based fee to the consumer loan originator, in which we have a non-controlling equity interest. The total fair value of these investments, which are included in Securities, at fair value on the Condensed Consolidated Balance Sheet, was $53.6 million as of September 30, 2025. The table below provides additional information about the automobile loans underlying these participation certificates, which comprise our investments in ABS backed by consumer loans, as of September 30, 2025:
Previous wording
(1)Excludes charged-off consumer loans with an aggregate unpaid principal balance and fair value of $90.2 million and $0.6 million, respectively, for which we have determined that it is probable the servicer will be able to collect principal and interest. See Note 5 of the Notes to Condensed Consolidated Financial Statements for additional details on charged-off consumer loans.
Current wording
(1)Excludes charged-off consumer loans with an aggregate unpaid principal balance and fair value of $93.6 million and $0.4 million, respectively, for which we have determined that it is probable the servicer will be able to collect principal and interest. See Note 5 of the Notes to Condensed Consolidated Financial Statements for additional details on charged-off consumer loans.
Previous wording
Our total long Agency RMBS portfolio increased by 5% quarter over quarter to $268.5 million, driven by net purchases.
Current wording
Our total long Agency RMBS portfolio decreased by 18% quarter over quarter to $220.7 million as of September 30, 2025, compared to $268.5 million as of June 30, 2025, driven by net sales.
Previous wording
The net interest margin on our Agency portfolio, excluding the Catch-up Amortization Adjustment, decreased to 2.29% as of June 30, 2025 from 2.46% as of March 31, 2025, driven primarily by a higher cost of funds. As with our credit portfolio, we continued to benefit from positive carry on our interest rate swap hedges, where we overall receive a higher floating rate and pay a lower fixed rate.
Current wording
The net interest margin on our Agency portfolio, excluding the Catch-up Amortization Adjustment, decreased slightly to 2.27% as of September 30, 2025, from 2.29% as of June 30, 2025. We continued to benefit from positive carry on our interest rate swap hedges, where we overall receive a higher floating rate and pay a lower fixed rate.
Previous wording
As of June 30, 2025 and March 31, 2025, the weighted average net pass-through rate on our fixed-rate specified pools was 3.9% and 4.0%, respectively.
Current wording
As of both September 30, 2025 and June 30, 2025, the weighted average net pass-through rate on our fixed-rate specified pools was 3.9%.
Previous wording
(3)As of June 30, 2025, includes $11.9 million of active HECM Buyout Loans, $17.7 million of inactive HECM Buyout Loans, and $5.3 million of other inactive HECM loans. As of March 31, 2025, includes $14.0 million of active HECM Buyout Loans, $14.1 million of inactive HECM Buyout Loans, and $5.2 million of other inactive HECM loans
Current wording
(4)As of September 30, 2025, includes $19.6 million of active HECM Buyout Loans, $17.3 million of inactive HECM Buyout Loans, and $5.7 million of other inactive HECM loans. As of June 30, 2025, includes $11.9 million of active HECM Buyout Loans, $17.7 million of inactive HECM Buyout Loans, and $5.3 million of other inactive HECM loans.
Previous wording
(4)As of June 30, 2025, includes $828.4 million of securitized proprietary reverse mortgage loans, $18.0 million of cash held in a securitization reserve fund, and $7.5 million of investment related receivables. As of March 31, 2025, includes $615.3 million of securitized proprietary reverse mortgage loans and $12.4 million of cash held in securitization reserve funds.
Current wording
(5)As of September 30, 2025, includes $953.2 million of securitized proprietary reverse mortgage loans, $19.2 million of cash held in a securitization reserve fund, and $6.6 million of investment related receivables. As of June 30, 2025, includes $828.4 million of securitized proprietary reverse mortgage loans, $18.0 million of cash held in a securitization reserve fund, and $7.5 million of investment related receivables.
Previous wording
Our Longbridge segment reported a net gain for the second quarter with positive contributions from both originations and servicing. In originations, higher origination volumes in both HECM and proprietary reverse loans, steady origination margins for both products, and net gains related to a proprietary reverse mortgage loan securitization drove results. Meanwhile, MSR-related income, strong tail securitization executions, and a net gain on the HMBS MSR Equivalent, primarily due to tighter HMBS yield spreads, drove the positive contribution from servicing. These gains were partially offset by net losses on interest rate hedges.
Current wording
Our Longbridge segment reported a net gain for the third quarter, with positive contributions from both originations and servicing. The positive contribution from originations was driven by higher origination volumes of proprietary reverse mortgage loans, higher origination margins for HECM loans, and net gains related to a proprietary reverse mortgage loan securitization completed during the quarter. Strong positive contributions from servicing reflected base servicing net income, strong tail securitization executions, and a net gain on the HMBS MSR Equivalent, driven primarily by tighter HMBS yield spreads. These gains were partially offset by a net unrealized loss on the retained tranches of consolidated proprietary reverse mortgage loan securitization trusts, due to faster prepayment speed assumptions, lower HPA projections, and higher applied discount rates.
Previous wording
Our Longbridge portfolio, excluding non-retained tranches of consolidated securitization trusts, decreased by 1% sequentially to $545.6 million as of June 30, 2025, as the impact of the securitization of proprietary reverse mortgage loans completed during the quarter slightly exceeded the impact of new originations in that sector.
Current wording
Our Longbridge portfolio, excluding non-retained tranches of consolidated securitization trusts, increased by 37% sequentially to $750.0 million as of September 30, 2025, driven by a record quarter of proprietary reverse mortgage loan originations at Longbridge, partially offset by the impact of a securitization of proprietary reverse mortgage loans completed during the quarter.
Previous wording
Results for the quarter also reflect a decrease in incentive fees incurred, partially offset by net unrealized losses on our unsecured borrowings and an increase in income tax expense.
Current wording
Results for the quarter also reflect an increase in the net unrealized loss on our unsecured borrowings partially offset by a decrease in income tax expense.
Previous wording
HMBS, we account for HMBS-related obligations as secured borrowings. Finally, as of June 30, 2025, we had $262.8 million of outstanding Unsecured borrowings including: (i) senior notes of $210.0 million, maturing in April 2027 and bearing an interest rate of 5.875%, and (ii) senior notes of $37.8 million, maturing in August 2026 and bearing an interest rate of 6.00% (collectively, the "Senior Notes"); as well as $15.0 million of unregistered junior subordinated unsecured debt securities (the "Trust Preferred Debt"). The indentures governing the outstanding Senior Notes contain a number of covenants, including several financial covenants. See Note 14 of the Notes to the Condensed Consolidated Financial Statements for additional details on our Unsecured borrowings.
Current wording
We have various financing arrangements in place as of September 30, 2025, including both secured and unsecured borrowings. We use repos, secured lines of credit, and various other secured borrowings to finance our portfolios, each of which we account for as collateralized borrowings. We have also obtained, through the securitization markets, term financing for non-QM loans, proprietary reverse mortgage loans, closed-end second lien mortgage loans, and consumer loans. Additionally, as an issuer of HMBS, we account for HMBS-related obligations as secured borrowings. Finally, as of September 30, 2025, we had $262.8 million of outstanding Unsecured borrowings including: (i) senior notes of $210.0 million, maturing in April 2027 and bearing an interest rate of 5.875%, and (ii) senior notes of $37.8 million, maturing in August 2026 and bearing an interest rate of 6.00% (collectively, the "Senior Notes"); as well as $15.0 million of unregistered junior subordinated unsecured debt securities (the "Trust Preferred Debt"). The indentures governing the outstanding Senior Notes contain a number of covenants, including several financial covenants. See Note 14 of the Notes to the Condensed Consolidated Financial Statements for additional details on our Unsecured borrowings.
Previous wording
As of June 30, 2025, outstanding borrowings under repos and Total other secured borrowings (which include Other secured borrowings and Other secured borrowings, at fair value, as presented on our Condensed Consolidated Balance Sheet) were $4.8 billion, of which approximately 4%, or $194.5 million, related to our Agency RMBS holdings. The remaining outstanding borrowings related to our credit portfolio and Longbridge. Additionally, we had $9.8 billion of HMBS-related obligations.
Current wording
As of September 30, 2025, outstanding borrowings under repos and Total other secured borrowings (which include Other secured borrowings and Other secured borrowings, at fair value, as presented on our Condensed Consolidated Balance Sheet) were $5.2 billion, of which approximately 3%, or $175.6 million, related to our Agency RMBS holdings. The remaining outstanding borrowings related to our credit portfolio and Longbridge. Additionally, we had $10.1 billion of HMBS-related obligations.
Previous wording
(2)For unsettled purchases and sales, assumes associated borrowings are subject to haircuts of 5.7% as of both June 30, 2025 and March 31, 2025, respectively.
Current wording
(1)For unsettled purchases and sales, assumes associated borrowings are subject to haircuts of 5.8% and 5.7% as of both September 30, 2025 and June 30, 2025, respectively.
Previous wording
(3)All of our non-recourse borrowings are secured by collateral. In the event of default under a non-recourse borrowing, the lender has a claim against the collateral but not any of the Operating Partnership's other assets. In the event of default under a recourse borrowing, the lender's claim is not limited to the collateral (if any).
Current wording
(2)All of our non-recourse borrowings are secured by collateral. In the event of default under a non-recourse borrowing, the lender has a claim against the collateral but not any of the Operating Partnership's other assets. In the event of default under a recourse borrowing, the lender's claim is not limited to the collateral (if any).
Previous wording
(4)Relates to our non-QM, European residential mortgage, and reverse mortgage loan securitizations, where we have elected the fair value option on the related debt.
Current wording
(3)Relates to our non-QM, European residential mortgage, and reverse mortgage loan securitizations, where we have elected the fair value option on the related debt.
Showing the first 40 of 140 pairs. Open the source sections for the rest.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
6.12%. Investments transferred as collateral under repos had an aggregate fair value of $3.5 billion and $3.3 billion as of September 30, 2025 and December 31, 2024, respectively. It is expected that amounts due upon maturity of our repos will be funded primarily through the roll/re-initiation of repos and, if we are unable or unwilling to roll/re-initiate our repos, through free cash and proceeds from the sale of securities.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
Reverse Mortgage Loans and Reverse MSRs
Previous report — wording carried elsewhere
We have various financing arrangements in place as of June 30, 2025, including both secured and unsecured borrowings. We use repos, secured lines of credit, and various other secured borrowings to finance our portfolios, each of which we account for as collateralized borrowings. We have also obtained, through the securitization markets, term financing for non-QM loans, proprietary reverse mortgage loans, closed-end second lien mortgage loans, and consumer loans. Additionally, as an issuer of
Previous report — wording carried elsewhere
(7)Includes equity investment in an unconsolidated entity which purchases certain other loans for eventual securitization.