Ready Capital Corp
For the period ended Dec 31, 2025. Filed Mar 2, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Mar 2, 2026
RC$0.85-20.4%Stored close · as of Nov 6, 2026
What changed in Risk Factors?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-03-03.
0001628280-25-009464
Item 1A. Risk FactorsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-02.
0001628280-26-013256
Item 1A. Risk FactorsThe 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.
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1884 unchanged; 196 reworded; 54 added; 319 removed; 30 previous and 9 current paragraphs rearranged.
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A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (54)
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markets. The U.S. mortgage market has experienced, in the past, a variety of difficulties and challenging economic
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conditions, including defaults, credit losses and liquidity concerns. Certain commercial banks, investment banks,
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insurance companies, and mortgage-related investment vehicles (including publicly traded mortgage REITs) have
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incurred extensive losses from exposure to mortgage markets as a result of these difficulties and conditions. Disruptions
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and future adverse consequences arising from such events may include continued volatility in exchange rates. We
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raise the federal debt ceiling on multiple occasions, ratings agencies have lowered or threatened to lower the long-term
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sovereign credit rating on the U.S. The impact of this or any further downgrades to the U.S. government’s sovereign
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ongoing compliance with this test (or such other statutory exception that may be applicable to our business, e.g., Section
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and we hold a majority of such interests. We have not requested the SEC, or its staff, to concur or approve our treatment
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qualifications based upon SEC staff guidance andno-action letters. We will also treat as qualifying assets for this
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use of artificial intelligence (“AI”) by threat actors to perpetuate cyberattacks. The result of these incidents may include
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cyber incidents, phishing attempts, brute force attacks, exploiting software vulnerabilities (including “zero-day attacks”),
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The use of AI by us, our Manager, our borrowers or third-party service providers could expose us to operational,
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legal, regulatory, financial and competitive risks.
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AI and machine learning technologies are increasingly being adopted across financial services, commercial real estate
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finance, data analytics, valuation, underwriting and cybersecurity. We, our Manager, our borrowers and third-party
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service providers may use or rely on AI-based tools in connection with investment analysis, underwriting, asset
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management, valuation models, cybersecurity, data processing or other business functions. The use of AI involves risks
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and challenges, including the potential for inaccurate or biased outputs, flawed assumptions, data privacy or
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confidentiality compromises, cybersecurity vulnerabilities, intellectual property concerns, and evolving legal and
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regulatory requirements. If AI-based tools or models are improperly designed, implemented or supervised, or if
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underlying data is incorrect, misleading or incomplete, their use could result in flawed investment decisions, operational
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disruptions, regulatory scrutiny, litigation exposure, or harm to our reputation and financial condition. In addition, the
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legal and regulatory frameworks governing AI continue to evolve, and future laws, regulations or enforcement actions
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could limit permissible uses of AI, increase compliance costs or impose liability for outcomes that may be difficult to
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predict or control. Our inability, or the inability of our Manager or service providers, to effectively manage the risks
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associated with AI or adapt to rapid technological change could adversely affect our business, financial condition and
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•the risk that liabilities that arose in a business prior to divestiture, such as prior liabilities of our recently
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divested Residential Mortgage Banking segment (formerly carried out by GMFS, LLC), could result in
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indemnification obligations with respect to such divestiture; and
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We finance the loans we originate through securitizations and other borrowings. For information on our committed and
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We have substantial debt maturing in 2026, including approximately $550 million of senior secured notes and
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We have substantial debt maturing in 2026, including approximately $550.0 million of senior secured notes and
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corporate debt. We believe that our sources of liquidity will provide sufficient liquidity to fund ongoing obligations. Our
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sources of liquidity include approximately $200.0 million of unrestricted cash and approximately $700.0 million of
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unencumbered assets as of December 31, 2025, and we also expect to have net liquidity from portfolio maturities and
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markets. The U.S. mortgage market has been severely affected by changes in the lending landscape and has experienced
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defaults, credit losses and significant liquidity concerns, and there is no assurance that these conditions have fully
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stabilized or that existing conditions will not worsen. Disruptions in mortgage markets negatively impact new demand
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inherent in the acquisition of delinquent LMM loans include undisclosed claims, undisclosed tax liens that may have
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resulted in the strengthening of the U.S. dollar against the foreign currencies in which we conduct business. We currently
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loans we held as of December 31, 2024, 5.3% were more than 60 days delinquent and 17.9% of those loans were
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acquired as a result of the Mosaic Mergers and the Broadmark Merger. Construction budgets may be unrealistic or
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Although we believe that we are currently one of only a handful of active market participants in the secondary LMM
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On August 1, 2023, Fitch downgraded the U.S. government’s sovereign credit rating to AA+, down one notch from its
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highest rating of AAA, citing the country’s growing debt obligations, deterioration in governance and political
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polarization. On November 10, 2023, Moody’s lowered the U.S. government’s credit rating outlook from “stable” to
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Moody’s, and any future downgrades by Fitch, Moody’s or other ratings agencies, could affect the terms or stability of
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originations and results of operations may be adversely affected.
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defaults with respect to residential mortgage loans. We believe that we are currently one of only a handful of active
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market participants in the secondary LMM loan market and the lack of liquidity may result from the absence of a willing
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securities issued by such trusts do not meet the definition of voting securities under the 1940 Act only in cases where this
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considered to be majority-owned subsidiaries for purposes of this analysis. We have not requested the SEC, or its staff,
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qualifications based upon SEC staff no-action letters. Although SEC staff no-action letters have not specifically
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addressed the categorization of these types of assets, we will also treat as qualifying assets for this purpose bridge loans
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In 2011, the SEC solicited public comment on a wide range of issues relating to Section 3(c)(5)(C) of the 1940 Act,
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including the nature of the assets that qualify for purposes of the exclusion and whether mortgage REITs should be
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regulated in a manner similar to registered investment companies. There can be no assurance that the laws and
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Risks Related to Our Residential Mortgage Lending Business
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Interest rate mismatches between our floating rate mortgages and our borrowings used to fund our purchases of
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We will likely fund our residential mortgage loans with borrowings that have interest rates that adjust more frequently
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than the interest rate indices and repricing terms of floating rate mortgage loans. Accordingly, if short-term interest rates
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increase, our borrowing costs may increase faster than the interest rates on our floating rate mortgage loans adjust. As a
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result, in a period of rising interest rates, we could experience a decrease in net income or a net loss.
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In most cases, the interest rate indices and repricing terms of floating rate mortgage loans and our borrowings are not
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identical, thereby potentially creating an interest rate mismatch between our investments and our borrowings. While the
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historical spread between relevant short-term interest rate indices has been relatively stable, there have been periods
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when the spread between these indices was volatile. During periods of changing interest rates, these interest rate index
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mismatches could reduce our net income or produce a net loss, and adversely affect the level of our dividends and the
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In addition, floating rate mortgage loans are typically subject to lifetime interest rate caps that limit the amount an
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interest rate can increase through the maturity of the floating rate mortgage loans. However, our borrowings under
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interest rates, the interest rates paid on our borrowings could increase without limitation while caps could limit the
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interest rates on these types of assets. This problem is magnified for floating rate mortgage loans that are not fully
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for real estate. Further, disruptions in the broader financial markets, including the occurrence of unforeseen or
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in mortgage markets negatively impact new demand for real estate. Further, disruptions in the broader financial markets,
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catastrophic events such as the effects of widespread health emergencies, geopolitical tensions or terrorist attacks, could
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including the occurrence of unforeseen or catastrophic events such as the effects of widespread health emergencies,
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adversely affect our business and operations. Any such disruption could adversely impact our ability to raise capital,
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geopolitical tensions or terrorist attacks, could adversely affect our business and operations. Any such disruption could
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cause increases in borrower defaults and decreases in the value of our assets, cause continued interest rate volatility and
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adversely impact our ability to raise capital, cause increases in borrower defaults and decreases in the value of our assets,
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movements that could make obtaining financing or refinancing our debt obligations more challenging or more expensive,
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cause continued interest rate volatility and movements that could make obtaining financing or refinancing our debt
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and could lead to operational difficulties that could impair our ability to manage our business. A deterioration of the
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obligations more challenging or more expensive, and could lead to operational difficulties that could impair our ability to
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LMM or LMM ABS markets or the broader financial markets may cause us to experience losses related to our assets and
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manage our business. A deterioration of the LMM or LMM ABS markets or the broader financial markets may cause us
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to sell assets at a loss. Our profitability may be materially adversely affected if we are unable to obtain cost effective
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to experience losses related to our assets and to sell assets at a loss. Our profitability may be materially adversely
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financing. A continuation or increase in the volatility and deterioration in the LMM and LMM ABS markets as well as
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affected if we are unable to obtain cost effective financing. Volatility and deterioration in the LMM and LMM ABS
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the broader financial markets may adversely affect the performance and fair market values of our LMM loan and LMM
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markets as well as the broader financial markets may adversely affect the performance and fair market values of our
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ABS assets and may adversely affect our results of operations and credit availability, which may reduce earnings and, in
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LMM loan and LMM ABS assets and may adversely affect our results of operations and credit availability, which may
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and manufacturing businesses to the U.S., increased tariffs, and rising energy and commodity prices could lead to
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and manufacturing businesses to the U.S., increased tariffs, andrising energy and commodity prices could lead to
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As of December 31, 2024, the average loan-to-value (“LTV”) on the originated portfolio was 68.3%. The weighted
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As of December 31, 2025, theweighted average loan-to-value (“LTV”) on the originated portfolio was 76.0%. The
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average LTV of our acquired loans was 80.4% as of December 31, 2024. LTV is calculated by dividing the current
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weighted average LTV on our acquired loans was 97.4% as of December 31, 2025. LTV is calculated by dividing the
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carrying amount by the most recent collateral value received. The most recent value for performing loans is often the
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current UPB by the most recent collateral value received. The most recent value for performing loans is often the third-
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third-party as-is valuation utilized during the original underwriting process. If such LMM loans with higher LTV ratios
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party as-is valuation utilized during the original underwriting process. If such LMM loans with higher LTV ratios
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become delinquent, we may experience greater credit losses compared to lower-leveraged properties. Additional risks
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become delinquent, we may experience greater credit losses compared to lower-leveraged properties.
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We finance the acquisition of a significant portion of our commercial and residential mortgage loans, MBS and other
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We finance the acquisition of a significant portion of ourcommercial loans, MBS and other assets with our repurchase
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assets with our repurchase agreements, credit facilities, and other financing agreements. Disruptions and uncertainty in
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agreements, credit facilities, and other financing agreements. Disruptions and uncertainty in the financial and banking
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the financial and banking sectors, including due to regional bank failures or decreased consumer confidence in the
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sectors, including due to regional bank failures or decreased consumer confidence in the banking system, may hinder our
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banking system, may hinder our ability to access capital on reasonable terms or at all. The U.S. and global financial and
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ability to access capital on reasonable terms or at all. The U.S. and global financial and banking sectors have at times
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banking sectors have at times experienced periods of increased turmoil and volatility and may experience similar periods
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experienced periods of increased turmoil and volatility and may experience similar periods of disruption in the future due
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of disruption in the future due to factors beyond our control. Such periods of increased turmoil and volatility may
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to factors beyond our control. Such periods of increased turmoil and volatility may adversely impact liquidity in the
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adversely impact liquidity in the financial markets and make financings less attractive or, in some cases, unavailable. If
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financial markets and make financings less attractive or, in some cases, unavailable. If our financing counterparties
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our financing counterparties become capital constrained, tighten their lending standards or become insolvent, they may
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become capital constrained, tighten their lending standards or become insolvent, they may be unable or unwilling to
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be unable or unwilling to fulfill their commitments to us. Although our financing counterparties are primarily large
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fulfill their commitments to us. Although our financing counterparties are primarily large national banks, a material
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national banks, a material disruption to the banking system and financial markets could result in liquidity issues across
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disruption to the banking system and financial markets could result in liquidity issues across the sector, which could
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the sector, which could adversely impact our access to capital and our cost of borrowing and adversely affect us, our
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adversely impact our access to capital and our cost of borrowing and adversely affect us, our business or our results of
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We are exposed to fluctuations in foreign currency exchange rates, particularly with respect to the Euro and the Pound
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We are exposed to fluctuations in foreign currency exchange rates, particularly with respect to the Euro (“EUR”) and the
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Sterling (“GBP”). Any significant change in the value of the currencies of the countries in which we do business could
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Pound Sterling (“GBP”). Any significant change in the value of the currencies of the countries in which we do business
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have a material adverse effect on our business, financial condition and results of operations. For example, geopolitical
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could have a material adverse effect on our business, financial condition and results of operations. For example,
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tensions and changes in monetary policies have caused increased volatility in global currency exchange rates that have
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geopolitical tensions and changes in monetary policies have caused increased volatility in global currency exchange rates
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hold, and may acquire in the future, investments that are denominated in GBP and EURs (including loans secured by
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currently hold, and may acquire in the future, investments that are denominated in GBP and EURs (including loans
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assets located in the United Kingdom or Europe), as well as equity interests in real estate properties located in Europe.
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secured by assets located in the United Kingdom or Europe), as well as equity interests in real estate properties located in
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Our assets and liabilities denominated in GBP may be subject to increased risks related to these currency rate
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Europe. Our assets and liabilities denominated in GBP may be subject to increased risks related to these currency rate
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Current or future pandemics and epidemics may adversely affect our borrowers, the real estate industry and global
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Future pandemics and epidemics may adversely affect our borrowers, the real estate industry and global markets, and
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markets, and our business and operations, financial condition, results of operations, liquidity and capital resources.
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our business and operations, financial condition, results of operations, liquidity and capital resources.
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Current or future outbreaks of highly infectious diseases could materially and adversely impact the value of our assets,
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Future outbreaks of highly infectious diseases could materially and adversely impact the value of our assets, our
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our business, financial condition and results of operations and cash flows, and both our and Waterfall’s ability to operate
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business, financial condition and results of operations and cash flows, and both our and Waterfall’s ability to operate
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performed an audit during 2024 and as a result of that audit, ReadyCap Commercial and Red Stone received an overall
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performed an audit during 2025 and as a result of that audit, ReadyCap Commercial and Ready Capital Affordable
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reduce earnings and, in turn, cash available for distribution to our stockholders.
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addition, if a builder fails to complete a project, we may be required to complete the project. Any such default could
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contractual rate specified in each loan agreement and added to the principal balance of the loan, rather than these loans
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credit rating or its perceived creditworthiness could affect the terms or stability of securities issued or guaranteed by the
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sell or selling assets we might wish to hold.
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when, we would not otherwise choose to do so, or (iii) register as an investment company, any of which would
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negatively affect the value of our shares of common stock, the sustainability of our business model, and our ability to
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wholly-owned or majority-owned subsidiaries of such entity.
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before January 1, 2026, no more than 20% of the value of our gross assets at the end of each calendar quarter may
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turn, cash available for distribution to our stockholders.
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priority, higher legal costs and greater difficulties in determining the value of the underlying property.
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business or our results of operations.
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may be required to complete the project. Any such default could result in a substantial increase in costs in excess of the
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facilities which may not be available on attractive terms.
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trusts are the functional equivalent of voting securities and that, in any event, such securitization trusts should be
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(iii) register as an investment company, any of which would negatively affect the value of our shares of common stock,
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business and the value of our shares of common stock.
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in the integration process include, but are not limited to, the following:
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repurchase agreements typically are not subject to similar restrictions. Accordingly, in a period of rapidly increasing
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indexed. Further, some floating rate mortgage loans may be subject to periodic payment caps that result in a portion of
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of assets than we need to pay interest on our related borrowings. These factors could reduce our net interest income and
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cause us to suffer a loss during periods of rising interest rates.
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adversely impact our business and financial results.
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of its operations in accordance with applicable policies and guidelines published by these entities. Failure to maintain
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business and investment options and could harm our business and expose us to losses or other claims. Fannie Mae,
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or assets in order to maintain approved seller/servicer status, which, if required, would adversely impact our financial
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prepayment estimates. We may pursue various hedging strategies to seek to reduce our exposure to adverse changes in
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interest rates. Our hedging activity will vary in scope based on the level and volatility of interest rates, the type of assets
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During the mortgage loan underwriting process, appraisals are generally obtained on the collateral underlying each
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prospective mortgage. The quality of these appraisals may vary widely in accuracy and consistency. The appraiser may
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feel pressure from the broker or lender to provide an appraisal in the amount necessary to enable the originator to make
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the loan, whether or not the value of the property justifies such an appraised value. Inaccurate or inflated appraisals may
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underwrite mortgage loans in accordance with their pre-determined loan underwriting guidelines, from time to time and
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in the ordinary course of business, originators may make exceptions to these guidelines. On a case-by-case basis,
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employment, longer length of time in business and length of time owning the property. Loans originated with exceptions
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may result in a higher number of delinquencies and defaults.
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market may adversely affect our business.
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conducted on an arm’s-length basis.
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market price of our common stock.